California License #4472487 | Texas License #3365362 | NPN License #21655529

Employment Practices Liability Insurance (EPLI) covers the legal costs and financial damages associated with employment-related claims. 

This includes lawsuits brought by:

• Current employees
  
• Former employees
  
• Applicants you didn’t hire
  
  

Covered claim types typically include:

• Wrongful termination
  
• Sexual harassment
  
• Discrimination (age, race, gender, religion, etc.)
  
• Retaliation or whistleblower claims
  
• Hostile work environment
  
• Defamation by a manager
  
• Mismanagement of employment benefits
  
  

📌 EPLI pays for legal defense, settlements, judgments, and more — even if the claim is groundless.

✅ Covered by EPLI:

• An employee claims they were fired due to their age
  
• A female employee sues for sexual harassment
  
• A terminated worker alleges retaliation after reporting safety violations
  
• A job applicant claims racial discrimination after not being hired
  
  

❌ Not covered:

• Bodily injury on the job (Workers’ Comp covers this)
  
• Data breach lawsuits (requires Cyber Liability)
  
• Errors in professional services (covered by E&O)
  
  

📌 EPLI focuses exclusively on internal employment-related disputes.

General Liability Insurance protects your business against claims of bodily injury or property damage caused to a third party — like a customer slipping on a wet floor.

EPLI, on the other hand, is designed specifically to cover legal actions taken by employees or job applicants against your business for issues like discrimination, harassment, and unfair employment practices. These internal, employee-related lawsuits are not covered under General Liability and require dedicated EPLI coverage.

Most EPLI policies offer:

• $250,000 to $5 million in total coverage
  
• With $100,000–$500,000 per claim limits
  
• Retention (like a deductible): Typically $2,500 to $25,000 per claim
  
  

💡 Pricing varies based on:

• Employee count
  
• Industry risk level (e.g., restaurants & construction are higher)
  
• Claims history
  
• Internal HR procedures
  
  

📌 Small businesses can often get EPLI for $800–$2,500/year.

🚫 EPLI exclusions vary by carrier, but often include:

• Wage and hour violations (e.g., unpaid overtime claims)
  
• Workers’ Comp and bodily injury claims
  
• Deliberate misconduct (criminal or fraudulent acts)
  
• Union disputes or collective bargaining issues
  
• ERISA violations (pensions, health benefits)
  
• Contractual liability unless endorsed
  
  

📌 Solution: We help you identify gaps and layer endorsements (like wage & hour defense) where needed.

📍 Claim Example:

A construction firm terminates an employee after multiple attendance issues. The employee sues for wrongful termination, claiming racial discrimination.

Outcome:

• $40,000 in legal defense
  
• $85,000 settlement
  
• Covered by EPLI, which included legal counsel, settlement negotiations, and public relations management
  
  

📌 Without EPLI, this could have forced layoffs or bankruptcy.

Common EPLI exclusions:

• Fines and penalties levied by regulators (like EEOC fines)
  
• Criminal behavior by owners or executives
  
• Uninsured subsidiaries or non-disclosed branches
  
• Prior or pending litigation before the policy began
  
• Claims arising from unreported incidents
  
• Inadequate recordkeeping
  
  

📌 Risk mitigation tip: EPLI doesn’t replace HR best practices — it enhances them. We structure coverage to work with your documentation and compliance strategy.

✅ Yes. EPLI pays for:

• Attorney’s fees
  
• Court costs
  
• Arbitration or mediation expenses
  
• Settlements (voluntary or court-ordered)
  
• Judgments and backpay (if awarded)
  
  

📌 Even if you did nothing wrong, the cost to defend a single claim can exceed $100,000. EPLI steps in early to fund expert legal representation and close cases quickly.

A wrongful act is any alleged:

• Discrimination (race, gender, religion, age, etc.)
  
• Harassment (sexual, verbal, emotional)
  
• Wrongful termination
  
• Retaliation
  
• Negligent hiring, promotion, or supervision
  
• Defamation of an employee by a manager
  
• Failure to provide equal opportunity
  
  

📌 Wrongful acts don’t have to be proven to trigger coverage — accusations alone are enough to activate the policy.

Without question.

EPLI is one of the most important and underutilized policies for businesses with even 1–5 employees.

💥 One wrongful termination lawsuit can cost:

• $35,000 to defend
  
• $75,000+ to settle
  
• Up to $200,000+ if litigated
  
  

⚠️ 60% of EPLI claims are filed against companies with fewer than 50 employees.

📌 EPLI isn’t just worth it — it’s business continuity insurance in disguise.

🧠 Prevention starts with proactive leadership and documentation:

• Maintain a legally reviewed employee handbook
  
• Implement anti-harassment and anti-discrimination training
  
• Use written performance evaluations and disciplinary procedures
  
• Document every hiring, firing, and promotion
  
• Avoid verbal-only agreements or ambiguous job roles
  
• Seek HR or legal counsel before termination decisions
  
  

📌 We provide policyholders with EPLI toolkits, including:

• Sample handbooks
  
• Termination templates
  
• Hotline access to employment law experts

✅ In many cases, yes — with proper endorsement.

Covered:

• Applicants who allege discrimination (even if never hired)
  
• Remote employees with legitimate employment status
  
• Independent contractors in states where misclassification is a legal exposure
  
  

❌ Not Covered (without endorsement):

• 1099s with no direct employment control
  
• Vendors or customers (unless third-party EPLI is added)
  

📌 Solution: We review your workforce structure and include coverage for nontraditional workers to match your actual exposure.