EPL Insurance: History of Employment Practice Liability

EPL Insurance: History of Employment Practice Liability

Since the 1990’s employment practices liability insurance (EPLI) has increased significantly in the marketplace from a new coverage to a necessity due to the growing number of of employment claims and the limited availability of coverage under existing insurance policies.

Prior to 1990, EPLI was offered only a limited basis. This quickly changed as employment litigation became one of the fastest growing areas of litigation in the United States. The Federal Whistleblower Protection Act, Family and Medical Leave Act, Civil Rights Act of 1991 and Americans with Disabilities Act all helped increase the number of employee litigation suits.

The trend continues today. Twenty-five percent of businesses reported an increase in wage and hour disputes, up from 18% the year before. There were also increases in age, race, and sex discrimination cases, labor union-related matters and disability discrimination suits.

The rise in employee-related cases created a natural need for EPLI insurance. Prior to its introduction, insureds sought coverage under various traditional forms of insurance including general liability, workers compensation and homeowners insurance.

Businesses are increasingly facing allegations from employees for racial and religious discrimination, sexual harassment, unfair pay and other significant claims. Whether you’re the head of a large corporation or smaller business owner, Employment Practices Liability insurance should be part of your comprehensive insurance program. The EPLI program provides coverage for legal fees, settlements and damage awards that result from employee claims of misconduct.

Part of the battle in protecting your business against EPLI suits is risk management to reduce a company’s exposure. At PLRisk Advisors, we can help your clients reduce their exposures with risk management practices, including employee evaluations and excellent documentation combined with top quality insurance programs. Contact us today for more information. (855) 403-5982