EPLI Insurance in Texas

What is EPLI Insurance? 

The moment a Texas business hires its first worker, the business becomes exposed to certain employment risks. Namely, a worker could accuse their employer of discrimination or something equally serious. To help protect against this sort of risk, businesses that have one or more employees may get EPLI insurance.

EPLI insurance offers specialized commercial coverage for businesses with employees. Policies may defend against an array of liability risks that come with hiring and employing workers.

Which Texas businesses ought to have employment practices liability insurance? 

Almost all employers in Texas can benefit from employment practices liability insurance. Just one discrimination lawsuit filed by an employee could be devastating if no coverage is in place.

In many cases, businesses would be prudent to secure EPLI coverage even before bringing on board their first employee. Many EPLI policies may cover a discrimination claim that an applicant makes during the hiring process.

What sorts of allegations are covered by employment practices liability policies?

Employment practices liability policies generally give broad protection against discrimination and certain other accusations employees could make. Depending on a specific policy’s terms, it might cover situations such as the following::

• Unpaid interns claim they did work for which they should’ve been paid
• Female employees learn that they’re paid less than male colleagues
• Minority employees are assigned low-level tasks below their position
• Applicants are asked about pregnancy or immigration during an interview
• Applicants aren’t notified that background checks will be run on them
• LGPTQ+ employees receive fewer opportunities than their colleagues
• Older employees are let go because of their age
• The work environment overall is claimed to be hostile

Similar to most commercial liability insurances, EPLI policies typically pay necessary legal defense costs, court fees, and settlements if a business faces a covered lawsuit (subject to a deductible).

Do EPLI policies also cover allegations made by volunteers? 

Nonprofit organizations that rely on large volunteer workforces are often subject to many of the same risks as employers. While it might happen less frequently, volunteers may allege that they were discriminated against, not receiving duties that others did because of their race, gender, sexual orientation, age or other prohibited reason.

Select employment practices liability insurance policies may provide coverage for volunteer-made allegations. Nonprofits that want to explore this option should work with an insurance agent specializing in EPLI to see what policies might cover volunteer-made allegations.

Is employment discrimination covered under general liability insurance? 

General Liability insurance primarily addresses common business risks such as “slip and fall” accidents, defamation, and false advertising. It usually doesn’t extend coverage to employment discrimination issues. 

For employment discrimination, employment practices liability insurance is usually needed. This can easily be bundled with general liability in most cases, but it’s a distinct coverage within a bundled policy.

Is employment discrimination covered under workers compensation?

Workers’ compensation primarily addresses workplace injuries and illnesses. It usually doesn’t apply to cases of discrimination or other non-injury employment risks. Again, employment practices liability insurance is normally needed for discrimination allegations.

Do EPLI policies cover discrimination claims made by customers or clients?

While it’s fairly uncommon, people other than employees and volunteers can file discrimination claims in certain cases. If a customer, client or vendor claims they were discriminated against on an illegal basis, the resulting lawsuit can be as serious as if an employee made the claim.

Not all EPLI policies cover allegations made by third parties, such as a customer or vendor, but a few policies might offer protection. If this is a big concern, a knowledgeable agent can help check for a policy that covers third-party claims.

How can Texas businesses get EPLI insurance? 

For help finding EPLI insurance in Texas, contact the independent insurance agents at Steve White Insurance. Our agents have the expertise necessary to help you find the best available EPLI policy, and we’re able to recommend the best policy regardless of what insurance company offers it.