What is Employment Practices Liability insurance and why do we need it?
Employment practices liability insurance is a type of liability insurance covering wrongful acts arising from the employment process. The most frequent types of claims covered under such policies include:
- Wrongful termination
- Sexual harassment
What else does Employment Practices Liability policy commonly cover?
In addition, it’s notable that Employment Practices Liability policies cover claims from a variety of other types of inappropriate workplace conduct, including (but not limited to) employment-related:
- Invasion of privacy
- Failure to promote
- Deprivation of a career opportunity
The policies cover directors and officers, management personnel, and all employees as insureds. The most common exclusions are for bodily injury (BI), property damage (PD), and intentional/dishonest acts.
In fact, Employment Practices Liability insurance policies are written on a claims-made basis. The forms can contain “shrinking limits” provisions, meaning that insurer payment of defense costs—which are often a substantial part of a claim—reduce the policy’s limits.
This approach contrasts with commercial general liability (CGL) policies, in which defense is covered in addition to policy limits. Although Employment Practices Liability insurance is available as a stand-alone coverage, it is also frequently sold as part of a management liability package policy.
In addition to providing directors and officers (D&O) and fiduciary liability insurance, management liability package policies afford the option to provide Employment Practices Liability insurance as well.
Why Employment Practices Liability coverage may often be overlooked?
Typically part of a Directors and Officers policy, Employment Practices Liability insurance is often under appreciated. It is notable that Employment Practices Liability Insurance insurance can be included in D&O coverage. To learn more about common insurance coverages visit our Insurance Info page.
We’re here to help you find the BEST commercial insurance…
Our team of insurance brokers is available to help answer any and all questions you might have about all of our commercial insurance products. If you have a question about business insurance, are uncertain about what a particular insurance coverage term means, or simply want to find commercial insurance that directly aligns with your needs, don’t hesitate to call us toll-free at 1-866-287-0448.
It’s time to get insurance value and choice aligned. Want Canadian business insurance that aligns with your bottom line? We can help. 365. Call us toll-free at 1-866-287-0448 or click to Get a Quote!
We’re ALIGNED across Canada. The ALIGNED Insurance National Operations Centre in Cambridge, Ontario supports our Toronto, Calgary and Vancouver offices. Our industry peers consistently recognize us as one of Canada’s best insurance teams. 100% Canadian owned, we are super proud to be one of the fastest growing insurance brokerages in the country.
We deliver e-news you can use. Get practical business insurance insights in your inbox every month. 19,000+ people subscribe to our free ALIGNMENT Matters e-news. Just click the JOIN OUR DISTRIBUTION LIST button – at the bottom of our homepage – to get connected.
365 | Get ALIGNED. Every day, Canadian business leaders read our insurance insights. Find us on LinkedIn, Twitter, Facebook, Instagram, LinkedIn and YouTube.