Every employer, large or small, faces the reality that it will be the target
of legal action from past, present, and prospective employees.
Through legislation like the Americans With Disabilities Act and the Family Medical Leave Act,
Congress has created new grounds for employers to be sued. The Equal Employment Opportunity Commission (EEOC)
provides some significant statistics with regards to discrimination cases (see right panel).
The policies we sell provide coverage for a wide spectrum of employment-related claims
and offer loss prevention programs for business professionals to help minimize the risk of those
We can provide some of the most comprehensive employment
practices Liability Policies offered to small businesses.
Consider the Following Facts Regarding the EEOC:
From October 1, 1993 through September 30, 1994, the Equal Employment
Opportunity Commission (EEOC) and related state and local agencies received
156 discrimination complaints.
As of May 1, 2003, the Equal Employment Opportunity Commission had a
backlog of over 100,000 complaints and the
average complaint took more than a year to handle.
In 2002 over 13,000 complaints of sexual harassment were filed with the EEOC.
Settlements for cases in 2003 exceeded 50 million. Defense costs were several times this number.
Consider the Following Facts Regarding the ADA:
From 1993 to 2009, there was a 29% increase in the number of charges filed under the
Americans With Disabilities act (ADA). There was a 43% increase in the number of complainants
who received money, and a 77% increase in the amount of money recovered for complainants.
From 1993 to 2009 ADA charges rose from 17.4% of all charges filed with the EEOC to 23% of all charges filed. The
EEOC filed 874 lawsuits claiming violations of the ADA, collecting a total of $86,633,804 for victims of disability
discrimination - THIS DOES NOT INCLUDE THE COST OF DEFENSE FOR THESE CLAIMS!
Settlements Can Be High: Employers will still incur expenses through defense costs regardless of awards:
- Defense Costs: $15,000
- Avg. Settlement: $75,000
Dismissal / Motion for Summary Judgment:
- Defense Costs: $50,000 - $75,000
- Avg. Awards: $0
Jury / Trial:
- Defense Costs: $125,000+
- Avg. Awards: $217,000
Watch Video: Where D&O takes over
from General Liability Insurance
(Data from Jury Verdict Research - only for ADA charges)
Not only are the numbers of employment-related claims increasing, but
so is the potential financial risk to your business. Defending a
wrongful termination or discrimination claim -- whether you are
innocent or guilty, or even if the claim is groundless or fraudulent --
can be expensive. The potential exposure for a money damages award
threatens your company's financial resources.
In the face of this increased risk to your business, it is also increasingly likely that your current
insurance excludes coverage for employment-related claims. Most
comprehensive general liability policies specifically exclude
employment-related claims. For the small for-profit business, a
directors and officers policy may offer a limited form of insurance
coverage, but will probably not extend coverage to the business entity.
Other forms of insurance, such as fiduciary liability coverage, are
unlikely to cover these types of claims:
- Sexual harassment
- Wrongful Termination
- Statute Violation
- Negligent Hiring
- Negligent Supervision
- Negligent Promotion
- Negligent Retention
- Breach of Contract
- Loss of Consortium
- Emotional Distress
- Invasion of Privacy
- Wage and Hour Disputes
- Drug Testing
- Mental Anguish
In response to the escalation in employment-related litigation and the
financial risk to small businesses for employment-related claims, we
offer our clients the service of shopping for Employment Practices
Liability. Drawing on our many years of experience in handling claims
for our clients, we have worked with carriers who specialize in, and
have designed, a comprehensive program to assist your business in
reducing its exposure to claims by employees.
June 1st, 2014
On May 16, 2014, the Internal Revenue Service (IRS) issued an FAQ response to clarify whether employers can provide added compensation to employees, so they may purchase individual health coverage.
June 1st, 2014
Business Owners Take Heed ?
The 5 coverage?s you probably think you already have, but probably don?t?
Cyber-Security LiabilityEmployment Related Litigation such as Wrongful Termination
Errors in business judgment that lead to claims by others against your company
Mismanagement of employee benefits, even when administered by 3rd parties
March 16th, 2014
I work with families who have private foundations, I also provide risk management services to many Non-Profit Organizations and I arrange insurance coverage for most of these. Board members frequently ask for a "quick reference guide" to the insurance needs and some of the basic risks that "typical" not for profit organizations face.
February 17th, 2014
REVENUE RULING 87-41 - FACTORS FOR DETERMINING IF INDEPENDENT CONTRACTOR STATUS APPLIES
February 4th, 2014
To a non-insurance person, this may sound like a bunch of gobbledygook... Let's see if we can help to make sense of it all. Commercial auto insurance policies protect several different parties; the business to which the vehicle is registered, you as the owner of the business, the vehicle itself and others. Insurance carriers are able to expand or restrict who is insured by using special codes when they build the policy for your company. In insurance lingo these codes are referred to as "symbols" or more specifically, coverage symbols.