Employment Practices Liability Insurance (EPLI)
Any business with employees can be sued by one. Employment practices liability insurance covers the legal defense and settlements when a current, former or prospective employee claims wrongful termination, discrimination, harassment or retaliation, even when you did nothing wrong. Stonebrook places EPLI for employers nationwide.
Reviewed by Nate Feuerman, High Net Worth Insurance Producer at Stonebrook
Last updated
Quick answers
What does EPLI cover?
Claims by employees and applicants of wrongful termination, discrimination, harassment, retaliation and related employment wrongs, including defense.
Does general liability cover employee lawsuits?
No. Employment-related claims are excluded from general liability and need EPLI.
Does EPLI cover claims from customers or residents?
Only with third-party coverage, which some policies offer for discrimination or harassment by your employees.
Does EPLI cover wage and hour claims?
Usually not, or only for limited defense costs. Wage and hour claims are typically excluded.
What EPLI covers.
Wrongful termination
Claims that an employee was fired illegally or in breach of an employment agreement.
Discrimination
Claims based on protected characteristics in hiring, firing, pay or promotion.
Harassment
Sexual and other workplace harassment, including hostile work environment claims.
Retaliation
Claims that an employee was punished for complaining, whistleblowing or taking protected leave.
Third-party coverage
Discrimination or harassment claims by customers, patients, residents or tenants.
Agency charges
Defense of charges before the EEOC and state agencies, which often come before a lawsuit.
Common EPLI exclusions and limits.
| Exclusion or limit | What to ask |
|---|---|
| Wage and hour | Is there any defense sublimit for wage and hour claims? |
| Retention | What do you pay before coverage applies, and does it differ for some claims? |
| Prior and pending litigation | Are known disputes before the policy started excluded? |
| Third-party claims | Are claims by residents, customers or tenants covered? |
| Consent to settle | Can the carrier settle without your agreement, and what happens if you refuse? |
EPLI for healthcare and real estate employers.
Skilled nursing, senior living and adult day care operators employ large, shift-based staffs with high turnover, which increases employment claims. Third-party coverage matters when residents or family members allege harassment.
Multi-family and real estate owners with property management staff face employment claims too. Tenant discrimination and fair housing claims need separate attention; ask us how your policy handles them.
Private companies and nonprofits often buy EPLI in the same management liability package as D&O.
Practices that help prevent EPL claims.
- Keep an up-to-date handbook.With anti-harassment, anti-retaliation and complaint procedures.
- Train managers.Most claims start with how a supervisor handles a situation.
- Document performance.Consistent reviews and records support termination decisions.
- Call before you fire.Many EPLI carriers offer free employment law hotlines.
A broker who knows your business.
Stonebrook is an independent agency. We work with standard, specialty and excess and surplus lines carriers, so we can shop EPLI across management liability carriers instead of fitting you into one company’s program.
Since 1982 we have placed commercial programs for businesses and property owners across the country. We read the fine print, flag the exclusions that matter for your operation, and advocate for you at underwriting, at renewal and at claim time.
Coverage that works together.
Most families need more than one policy. Here is how the pieces fit.
EPLI questions, answered.
What does employment practices liability insurance cover?
EPLI covers claims by employees, former employees and job applicants alleging wrongful termination, discrimination, harassment, retaliation and related employment wrongs, including defense costs, settlements and judgments.
Do small businesses need EPLI?
Yes. Employment claims can be filed against businesses of any size, and defense costs alone can be significant even when the claim has no merit.
Does EPLI cover wage and hour lawsuits?
Usually not. Wage and hour claims are typically excluded, though some policies offer a limited sublimit for defense costs.
What is third-party EPLI coverage?
An extension that covers discrimination or harassment claims made by non-employees, such as customers, patients, residents or tenants, against your business or employees.
Is EPLI claims-made?
Yes. EPLI covers claims first made during the policy period, so continuous coverage and prompt reporting matter.
Is EPLI included in D&O?
Not automatically. It is a separate coverage part, but it is often packaged with D&O in a management liability policy for private companies and nonprofits.
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