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Business Insurance: Liability

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Employment Practices Liability (EPL) – why every business needs coverage.

Employers large and small are increasingly targets of lawsuits alleging a “wrongful employment act” that violates employment rights protected by law – wrongful termination, discrimination, sexual harassment, hostile workplace, retaliation, invasion of privacy, and numerous variations of these topics.


  • Employment practices liability lawsuits represent 30% of all civil litigation in the US today  (source: Bickmore Risk Services)
  • Three out of five large employers are sued by former employees every year (source:  Society of Human Resource Managers)
  • There are more than 27,000 open lawsuits against employers with less than 100 employees (source: EEOC)
  • The average cost to defend an EPL lawsuit to jury trial is $150,000. (source:  Insurance Journal) 
  • Jury verdicts are in favor of plaintiff’s 67% of the time (source: Jury Verdict Research)
  • The median jury award is $250,000 (source: Jury Verdict Research)
  • Costs for defense and judgments are uninsured because Commercial General Liability forms cover bodily injury & property damage type claims but do not cover breach of employment contracts or wrongful employment acts.

Before EPL insurance was available, employers funded the total cost of litigation and judgments themselves, taking valuable resources away from their business. The growth in claims of discrimination and then sexual misconduct spawned the beginnings of Employment Practices Liability Insurance (EPLI).  The first policies were provided to large public companies and their board of directors. Availability expanded as the growth of EPL claims shifted to privately owned business, non-profits organizations and small business.

Employment Practices Liability Insurance (EPLI)
Now EPLI coverage is readily available for nearly every business – large and small – at very affordable premium rates.

  1. EPLI for public companies and non-profit organizations is offered as an endorsement to Directors & Officers Liability policies or on a stand-alone basis.
  2. EPLI for private companies (usually with 100 or more employees) is available on a stand-alone policy basis.
  3. EPLI for small business is offered as an endorsement under most Business Owners Policy (BOP) forms at very low rates with policy limits up to $100,000.  

AMERICAN INSURANCE specializes in EPLI and other professional liability coverage with direct access to America’s biggest insurance companies for large and small employers of every kind.  Contact us for more information. 


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FAQ Disclaimer

The content of FAQ articles are general in nature and are not intended as a substitute for professional legal, financial, or insurance counsel for individuals. Insurance coverage forms vary by issuing company and by state. For specific advice contact us.

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