Why Every Employer Needs Protection—No Matter the Size

Lawsuits from employees, former staff, or even job applicants are one of the fastest-growing risks for businesses today. It doesn’t matter if you’re a contractor, manufacturer, or office-based professional service provider—if you manage people, you’re exposed.

And here’s the catch: General Liability policies don’t cover employment-related claims. That’s where Employment Practices Liability Insurance (EPLI) comes in.

In this blog, we’ll break down what EPLI is, the most common claims it covers, and how to protect your business from one of the most expensive lawsuits you might ever face.

What Is Employment Practices Liability Insurance (EPLI)?

EPLI covers legal costs, settlements, and judgments related to employment-related disputes, including claims of:

• Wrongful termination

• Harassment (including sexual harassment)

• Discrimination (race, age, gender, disability, etc.)

• Retaliation

• Failure to promote

• Mismanagement of employee benefits

• Breach of employment contract

📍 These claims don’t need to be true to cost you money—only alleged.

Why Small and Midsize Businesses Are at High Risk

Many business owners assume EPLI is for big corporations with HR departments. But the reality is:

• 60% of EPLI claims are against companies with fewer than 100 employees

• The average cost to defend and settle an EPLI claim is over $125,000

• You can be sued by former employees, current staff, or even job candidates

If you’ve ever:

• Let someone go

• Disciplined an employee

• Posted a job ad

• Promoted one person over another

…you’re exposed.

What GL and Workers’ Comp Won’t Cover

A lot of business owners are shocked to learn:

• General Liability only covers bodily injury and property damage

• Workers’ Comp only covers injuries on the job

• None of them cover harassment, discrimination, or retaliation lawsuits

Without EPLI, you pay out-of-pocket for:

• Attorney fees

• Court costs

• Settlement amounts

• Reputational damage control

Common EPLI Claim Scenarios

• A former employee sues for retaliation after reporting safety concerns

• An applicant alleges they were passed over due to age or gender

• An employee claims a hostile work environment due to unaddressed harassment

• A terminated worker says the firing violated an implied contract

📍 Even if you win in court, the legal fees alone can devastate your cash flow.

How We Help Protect Clients from EPLI Risks

At Innovators Insurance, we go beyond the policy by helping you:

• Choose the right EPLI limit and deductible for your company size

• Bundle EPLI with Management Liability or Directors & Officers (D&O) if needed

• Access HR support tools (handbook templates, compliance guidance, hotlines)

• Review job descriptions, termination procedures, and disciplinary documentation

Real-World Example

A manufacturer terminated an underperforming employee. Six months later, they received a claim for gender discrimination and retaliation. Their GL carrier denied it.

With an EPLI policy and documentation in place, they:

• Triggered legal support immediately

• Settled out of court with insurer-paid legal fees

• Had zero out-of-pocket cost beyond the deductible

Ready to Protect Your People—and Your Business?

Don’t let an HR misstep or a false allegation cost you your business. Let’s put EPLI in place and give you the tools to manage employees with confidence.

Learn More About Our Employer Risk Solutions

You hire people to grow your business. Let’s make sure they don’t become your biggest liability.