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Employment Practices LIability

What employers need to know about EPLI and D&O Coverage

There are many forms of workplace discrimination:

Sexual Harassment   –   Other forms of Harassment   –   Invasion of Privacy

Failure to Promote   –   Wrongful Termination   –   Defamation   –   Etc.

Employment Practices Liability will pay for legal costs, possible settlements and damages

to the employee that filed the claim.


What is the difference between EPLI and D&O

If a prospective, present or past employee sues the company for wrongful employment practices:

EPLI (Employment Practices Liability Insurance) protects the COMPANY 

D&O (Directors & Officers Insurance) protects the DIRECTORS, OFFICERS, OWNERS 

While every company should consider EPLI coverage, supplementing with D&O is increasingly important for:

Non Profits   –   Executives that make hiring, firing and discipline decisions   –   Companies seeking funding   –   Companies with distressed financials    Companies considering mergers or acquisitions    –   Companies looking to acquire top executives or investors

If Employer LOSES

May have to pay

  • Lost wages and benefits
  • Attorney and Court Costs
  • Employee’s legal fees
  • Compensatory Damages (Damage to Reputation, Pain and Suffering)

If Employer WINS

Employment related claims tend to be very lengthy in the court system. 

  • Attorney costs can be very high
  • Court costs

For businesses of all sizes:


Average settlement is about $75,000


Average jury award is about $250,000


Defense averages about $120,000 per claim


If a business loses its case, it must also pay for the claimant’s legal fees – averaging $200,000

Source: The Hartford

Preventive Measures

Factors that impact Employment Practices Risk

Number of Employees   –   Turnover   –   HR Practices
Industry (retail, hospitality, and higher customer interacting professions)

OnBoarding & OffBoarding

  • Make sure all processes are vetted and properly documented
  • Raise and hour protocols are up to date
  • Consult with an attorney if you are terminating multiple people at once

Poor Performance

  • Make sure each incident is properly documented siting examples and explaining how the employee was reprimanded
  • Get your managers and supervisors on board with documenting

HR Procedures

  • Have written policies and procedures on how company handles harassment
  • Provide training to employees annually on harassment in the workplace

Options for Protection

Many General Liability or Business Owner Plans (BOP) offer an endorsement for EPLI coverage.  D&O coverage must be purchased as a separate policy.

EPLI limits generally range from $10,000 to $250,000 without additional underwriting. 

$250,000 to $1,000,000 may be available with some underwriting questions.

We would typically look to a monoline EPLI policy for limits $500,000 +

D&O coverage is generally available for $25,000 +

Contact Us

Our Address

347 N. Pottstown Pike
Suite 200
Exton, PA 19341

Contact Us
P: 610.430.6650
F: 610.430.6652

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