Business Insurance-
It’s great to own your own business – at least we like it. It comes with freedom and flexibility that you don’t always get when working for someone else.
But there are also some hidden pitfalls and dangers in owning a business – things that are not covered by General Liability Insurance that the average business owner carries.
Are You Covered?
Charges against employers for discrimination, harassment, wrongful termination, retaliation, and wage-and-hour violations are at all-time highs. Three out of 5 employers are sued every year, and we hear stories like this almost daily on the news.
Employment Practices Liability Insurance (EPL) covers actual and alleged acts of discrimination, harassment, retaliation, wrongful termination and other similar acts, and is divided into 2 separate areas:
First Party EPL coverage
Employment Practices Liability Insurance (EPL) will help protect you if an employee makes a claim against you or a fellow employee. It covers allegations from employees against other employees and/or the employer itself based on discrimination, harassment, wrongful termination, retaliation and other specified “Wrongful Acts.” For example, if Trent (not his real name) works as a masseuse at a hotel spa and alleges another employee has sexually harassed him, the case could cost Trent’s employer tens or hundreds of thousands of dollars in legal and possible settlement or judgment fees, even if the other employee denies the allegation and Trent can produce little or no evidence of the harassment.
Third Party EPL coverage
Third parties include your customers or clients, any vendors you may have, and independent contractors such as a cleaning service. If you own a butcher shop and a client enters with a guide dog but is asked to leave by the shift manager because he believes the dog presents a health hazard, the customer can sue for violation of the Americans with Disabilities Act. The average cost of defense in EPL cases is $150,000. Settlements and jury awards can bring that total even higher.
As in so many other things, being aware of potential problems is the first step in protecting yourself and your business.
