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EPL Coverage: Employer Protection When Something Goes Wrong

by Signature B&B Companies | Apr 27, 2018 | medical malpractice, healthcare | 0 Comments

Employee lawsuits have risen about 400 percent with wrongful termination lawsuits jumping to more than 260 percent over the past 20 years.

And it’s not just large businesses. Roughly 41.5 percent of employee lawsuits are brought against private companies with less than 100 employees.

The financial impact can be dramatic. The cost of settling out of court can average $75,000, which can climb to $217,000 or more in court costs.

Roughly seven out of 10 businesses don’t carry Employment Practices Liability (EPL) insurance. An expensive mistake.

It’s especially harmful to healthcare facilities since its generally not factored into their overall property and casualty coverages.

What is EPL Coverage?

EPL policies are specifically designed to protect employers from lawsuits brought on by employees providing coverage for many situations that general liability insurance does not.

EPL covers losses caused by employee lawsuits and includes all court costs and legal fees.  So, in an environment where courts tend to favor the employee, an ELP policy can be the difference between keeping your doors open or not.

Other risks included in EPL coverage:


  • Sexual harassment
  • Workplace harassment
  • Discrimination
  • Wrongful termination
  • Failure to employ or promote
  • Retaliation
  • Wrongful discipline
  • Breach of employment contract
  • Negligent evaluation
  • Deprivation of career opportunity
  • Deprivation of career opportunity
  • Admitted and non-admitted paper
  • Primary and excess


  • Duty to defend or reimbursement policy
  • Full prior acts coverage
  • No intentional acts exclusion
  • Broad definition of insured
  • Admitted paper


  • Accounts with prior claims
  • Start-up operations


  • Third-party liability
  • Illegal immigration defense costs
  • Wage and hour defense costs (Fair Labor Standards Act – FLSA)
  • Workplace violence coverage
  • Defense outside the limit, additional defense costs limit
  • Claims arising from the use of social media
  • Franchisor coverage extension

Commercial Package vs. EPL Insurance

Don’t be fooled. Unless you have a separate EPL policy, your business is not covered against employee lawsuits. According to an industry study, six out of 10 non-buyers of EPL coverage mistakenly think they are protected under other policies.

With many general lines agencies not fully understanding all the unique risks facing healthcare businesses, we recommend finding an agency that specializes in healthcare and secure separate policies for both EPL and directors and officers (D&O) insurance.

Signature B&B Companies is a full-service agency with a specialized healthcare team that can assess your commercial liability policies and recommend strategies that will reduce costs while enhancing protection.

To learn more or get a free assessment of your current coverages, call Julie Shumer at 516.240.8872 or email jshumer@sbbinsure.com. If you'd like a quote, please complete this quick form.