January 2007 / Issue 13

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Insurance

Employment Practices Risk Management: Protecting Your Company

By ABD Insurance Services

Despite the short history, employment practices liability insurance (EPLI) is in great demand by employers large and small. More and more newspaper headlines report sexual harassment lawsuits, age discrimination lawsuits, and wrongful termination suits. Increased frequency has also been seen in claims resulting from third party actions against employers (claims from employees who are harassed by third parties coming into the workplace) as well as in claims resulting from your employees actions at another employers site. As these trends continue to grow, all employers should be concerned about the rising cost of litigation.

Insurance is only one answer. Practical preventative risk management can prevent lawsuits and is equally as important. There are several risk management programs for employers in the marketplace but key coverages that should be included in any program are:

  • Discrimination
  • Harassment
  • Inappropriate employment conduct
  • Libel, slander and defamation of character, and invasion of privacy (personal injury)
  • “Named insured” wording that includes the entity, directors, officers and their spouses, partners, managers, supervisors, employees and independent contractors.
  • Full prior acts coverage
  • Duty to defend
  • Insured’s right to approve claims settlement
  • No co-payment
  • No intentional acts, bodily injury or assault & battery exclusions
  • Third party claims

In addition to these coverages and risk management programs, access to Human Resources support and on line legal assistance is critical with the myriad of claims scenarios evolving today. It allows you as the employer to speak directly to employment practices experts when needed.

Premiums range from minimums under $1,000 and deductibles of $2,500 on up with limits available from $300,000 to $2,000,000 based on industry and number of employees (as well as claims experience).  Defense coverage is within the limits and is often the greatest expense in an employment practices claim.

For more information on assessing your employment practices risk and to learn how to obtain these coverages through ABD Insurance Services, please contact Bob Murphy or Dave Anderson, ABD Insurance Services, at 800 246-0901 or www.CyberSure.com.