EPLI Insurance Coverage Information

There is a lot volatility going on now around the country and we as employers need to be careful on all counts.


Sadly, but true, small business are sued every day by prospective, current, and former employees – for discrimination, harassment, wrongful termination and more. These claims involve restaurants, retailers, medical offices, contractors, and other businesses who also thought they would never be sued by an employee. Many business owners say, “It will never happen to me.”

Most do not know there’s a specific type of insurance coverage that you might want to consider to help protect your business.


EPLI covers businesses against claims by workers that their legal rights as employees of the company have been violated.


The number of lawsuits filed by employees against their employers has been rising. While most suits are filed against large corporations, no company is immune to such lawsuits. Recognizing that smaller companies now need this kind of protection, some insurers provide this coverage as an endorsement to their Businessowners Policy (BOP). An endorsement changes the terms and conditions of the policy. Other companies offer EPLI as a stand-alone coverage.


EPLI provides protection against many kinds of employee lawsuits, including claims of:


  • Sexual harassment
  • Discrimination
  • Wrongful termination
  • Breach of employment contract
  • Negligent evaluation
  • Failure to employ or promote
  • Wrongful discipline
  • Deprivation of career opportunity
  • Wrongful infliction of emotional distress
  • Mismanagement of employee benefit plans



An employee feels they did not get a promote and it was due to age. Suit was filed and they received $45,000.


A pregnant employee was fired due to attendance. A suit was filed, and she received $35,000.


A male supervisor made a sexual joke to female co-worker. A suit was filed, and she received $75,000.


This happens everyday no matter the size of your business.



The cost of EPLI coverage depends on your type of business, the number of employees you have and various risk factors such as whether your company has been sued over employment practices in the past. The policies will reimburse your company against the costs of defending a lawsuit in court and for judgments and settlements. The policy covers legal costs, whether your company wins or loses the suit. Policies also typically do not pay for punitive damages or civil or criminal fines. Liabilities covered by other insurance policies such as workers compensation are excluded from EPLI policies.


To prevent employee lawsuits, educate your managers and employees so that you minimize problems in the first place:


  • Create effective hiring and screening programs to avoid discrimination in hiring.
  • Post corporate policies throughout the workplace and place them in employee handbooks so policies are clear to everyone.
  • Show employees what steps to take if they are the object of sexual harassment or discrimination by a supervisor. Make sure supervisors know where the company stands on what behaviors are not permissible.
  • Document everything that occurs and the steps your company is taking to prevent and solve employee disputes.




It is your job as a business owner to protect your employees and your business.


Reach out to your current insurance agent to see about EPLI coverage.


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