In today’s society it is very important to have insurance for claims that arise out of human resource issues. The average cost of a discrimination claim is $125,000, and 25 percent of judgments exceed $500,000. While many claims are groundless, defending them can be very costly and time consuming.
If you carry Employment Practices Liability Insurance, or EPLI, you have protection for lawsuits from current, prospective or former employees that claim you have discriminated or harassed them. Things like sexual harassment, wrongful termination or discrimination are potentially covered by EPLI. The hidden danger in your EPLI policy is what happens if you are sued by a customer, vendor, or supplier? Are you covered?
The answer might surprise you. If you have a standard EPLI policy, you are most likely not covered. Most EPLI policies only cover you for claims from current, prospective or former employees. Most commercial general liability policies exclude harassment and discrimination. So, what is the solution? Third Party EPLI Coverage! Third party EPLI can be endorsed to most EPLI policies at a minimal cost. An endorsed EPLI will now pay for claims for customers, vendors, or third parties that bring lawsuits alleging discrimination or harassment. Make sure your trusted advisor is recommending third party coverage when purchasing EPLI Insurance.