Though EPLI insurance continues to become more costly, the need for coverage has risen as well. With an upward trend in employment-related lawsuits and government administrative actions, employers cannot afford to believe they have all their bases covered.
According to a recent HRMagazine article, Employer Practices Liability Insurance, though unheard of only ten years ago, has become a vital investment for businesses of every size. Similar to personal insurance coverage, like health insurance; you may find it unlikely that you will get cancer; but if you do, it will cost a great deal. An employer may believe that the organization will never have to use its policy, but if they do, it would be a costly mistake to not have coverage. With a recent $30.6 million verdict in a sexual harassment case, it is evident claims are becoming more expensive. Furthermore, employers must recognize that during troubling economic times, the likelihood of receiving a claim increases. And while verdicts have been increasing monetarily, there is also an upward trend in small businesses being battered by more frivolous claims.
You can consider buying this type of coverage, but that is still treating the symptom and not the cause. It is possible to put in place employment practices that reduce your exposure to employer related liabilities whether you purchase insurance or not. These practices are often easy to implement and cost very little, if anything, to maintain. Make sure the person in your firm is putting these procedures into practice in your business.