Employment Practices Liability Insurance


Employment Practices Liability Insurance Policy cover an employer against claims by employees alleging that they suffered damages as a result of the employer's discrimination, wrongful termination, sexual harassment, or various other employment-related offenses.

The growth of Federal and State legislation dealing with employment discrimination and sexual harassment, the changing legal views on wrongful termination, and the increasing tendency of aggrieved parties to turn to the courts for settlement of such disputes have caused insurers to specifically exclude coverage for such employment-related claims from CGL policies. To fill this gap in coverage, a number of insurers offer employment practices liability (EPL) Insurance. Since EPL policies are independently developed, there is no standard form; however mot policies are similar in their terms and conditions.

Coverage under EPL policies does not apply to all employment practices, rather, the policies specify the exact type of claims that are covered. Claims by employees alleging discrimination, sexual harassment, and wrongful termination are usually included as covered events. Some policies also cover breach of employment contract, failure to employ or promote, and wrongful discipline.