Within the past six months a number of the policies have been expanded to include almost all types of personal injury claims that could be brought by an employee against an employer and the cost has been significantly reduced. The current EPLI policies vary considerably in the coverage they provide and each needs to be reviewed carefully to determine if it suits a particular employers needs. They are not intended to protect companies or their employees against willful or intentional violations of the law, but most will provide a defense for such a claims until a court has determined that a specific individuals action was intentional. At the point this is determined the policy no longer applies. The policies typically cover the corporation and past and current officers, directors, partners, and managers.
Some policies provide coverage for all employees.
Many employment related suits result in punitive damages awards which can be far in excess of the compensatory damages. Some policies include coverage for punitive damages, but this is meaningless to California employers as punitive damages are not insurable by law in California. Companies seeking EPLI coverage must complete an extensive application which has opened the eyes of many in senior management to the need for attention to their current internal human resources practices and the high cost of past employment practices litigation. As underwriters are unwilling to pick up known claims companies seeking EPLI coverage must divulge any current or likely claims against them. Brokers can assist policyholders in becoming more knowledgeable employers from the standpoint of their employment practices liability exposures.