What Is Employment Practices Liability Insurance?
Employment Practices Liability Insurance (EPLI) covers claims brought by current, former or prospective employees alleging their employment rights were violated. It pays your defense costs and any settlement or judgment, starting as early as an EEOC or state agency charge.
What EPLI Covers
- Wrongful termination — including layoffs and performance-based firings
- Discrimination — age, race, gender, disability, religion, pregnancy and other protected classes
- Harassment — including hostile work environment claims
- Retaliation and whistleblower claims — often the fastest-growing claim type
- Failure to hire or promote, wrongful discipline, and employment-related defamation or privacy claims
- Third-party claims (optional) — harassment or discrimination claims from clients or customers, important for consultants working on client sites
Most EPLI policies exclude or only sublimit wage-and-hour disputes, and exclude WARN Act, ERISA and workers' comp claims.
What EPLI Costs
Price is driven by headcount, the states your employees work in (California, New York, New Jersey and Illinois cost more), turnover, HR practices and prior claims. In recent management liability quotes from Cowbell's program underwritten by Zurich, small professional-services and tech firms saw EPLI at about $1,850–$2,450 a year for $1M with a ~$2,000 retention.
Bundle It With D&O
EPLI is usually bought inside a management liability package with D&O (and often fiduciary and crime). A termination that becomes a lawsuit against both the company and its officers is then covered under one program instead of two policies that may argue over who pays.
