Rockwood Offers EPLI for Small-Midsize Firms

PRODUCT: Employment practices liability insurance

COMPANY: Member companies of the Houston International Insurance Group

BEST RATING: A- (Excellent)

AVAILABILITY: Coverage is available through appointed brokers on a wholesale and retail basis.

FOCUS: Due to the expansion of many federal and state discrimination laws, employees now have numerous avenues for challenging employer practices in court. In the federal courts alone, according to the U.S. Department of Labor (DOL), the number of suits related to employment grievances has increased by more than 400% in the last 20 years.

In discussing employment litigation and dispute resolution, the DOL’s Office of the Secretary reports that for every dollar paid to employees through litigation, at least another dollar is paid to attorneys involved in handling both meritorious and non-meritorious claims. “A company can be financially devastated when a savvy trial lawyer teams up with a disgruntled employee to file an employment practices-related lawsuit,” says Joanne LaMaestra, production manager at Rockwood Insurance.

That’s where employment practices liability insurance comes in. Designed to protect employers from employee lawsuits, EPLI covers situations which general liability insurance does not.

“Our EPLI provides defense and indemnity protection against claims arising from the employer/employee relationship,” LaMaestra explains. “The policy shields employers, plus all current, former and prospective employees, as well as directors & officers. It even shields the corporate entity against a broad spectrum of alleged wrongful employment practices.”

UNDERWRITING: The product is designed to protect the insured against allegations of discrimination, such as failure or refusal to hire or any other wrongful treatment of individuals based on their race, sex, color, religion, sexual orientation, age or disability. In addition, the product protects against both sexual and non-sexual harassment; wrongful termination involving actual or alleged wrongful dismissal, discharge or termination of employment, including breach of contract; and retaliation, including unlawful or abusive treatment resulting from an employee’s exercise or attempted exercise of any rights under law.

Policy features include coverage for third-party wrongful acts, an expanded coverage territory that includes worldwide claims coverage, wage and hour coverage, multiple liability limit options up to $2 million per claim and $2 million in the aggregate, “soft hammer” wording with a 75/25 insured/insurer split, full prior acts, coverage for alleged violations of the Immigration Reform Control Act and prior acts coverage.

Rockwood’s EPLI policy can include optional endorsements to address unique liability exposures. Coverage enhancements include immigration coverage extension, defense costs and limit of liability, with an additional limit available for legal defense costs.

MINIMUM PREMIUM: $800.

TARGET: The product is designed for businesses with up to 250 employees. Rockwood can provide coverage for all classifications except casinos, schools and colleges, country clubs, financial institutions, nursing homes, extended care facilities, insurance companies, labor unions, temporary staffing firms, churches and religious institutions, public entities, franchises and discontinued or dormant companies.

COVERAGE TERRITORY: All U.S. states except Alaska and Washington.

CONTACT: Joanne LaMaestra, production manager; Rockwood Programs, Inc., 3001 Philadelphia Pike, Claymont, DE 19703; 800-558-8808.

Ronimarie Acord is an IA contributor.