Content on this page requires a newer version of Adobe Flash Player.

Get Adobe Flash player


Employment Practices Liability Insurance is a relatively new form of liability insurance. It provides protection for an employer against claims made by employees, former employees, or potential employees. It covers discrimination (age, sex, race, disability, etc.), wrongful termination of employment, sexual harassment, and other employment-related allegations. It covers your firm, including its Directors and Officers.

Employment Practices Liability Insurance is needed as soon as you start to hire employees. Most investors and directors will require that you carry this coverage as part of your Directors and Officers Liability Insurance since they can also be held liable in suits relating to employment practices.

Cases against employers are on the rise. It is estimated that three out of five firms will be sued by an employee. Companies are finding that they are vulnerable from the pre-hiring process through the exit interview, even if the employee was never hired, or only at the company a matter of days.

It can happen to ANY firm. Every employer faces the reality that it will be the target of legal action from past, present and prospective employees. You can't always monitor every hire, termination, or conversation that takes place in your office. Nor can you always know who will sue, and you can't always prevent a disgruntled employee from lying or exaggerating just to “get even” with your firm. Even if the claim is groundless or fraudulent, the defense of a suit can be expensive in time, resources and financially.

Newer and fast growing companies are often prey to these types of claims because their management team has not yet designed or implemented procedures for hiring, firing, and disciplining employees.

© 2009 Warren Insurance Corporation. All Rights Reserved.