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Employment Practices
Liability Insurance Quotes
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At one time,
Commercial General Liability (CGL) policies were
held by various courts to have to respond to
employment-related complaints. Either a CGL was
found to have an obligation to handle
allegations of certain personal injuries or,
minimally, the policy was obligated to provide a
legal defense. Due to such developments, CGL
wording was changed to specifically exclude
suits and claims involving any aspect of
employer liability.
In recent years
an increasing number of allegations have been
made by employees who claim to have suffered
various types of financial loss or emotional
injury because of their employer’s acts (or
failure to act). The list of allegations
involves wrongful termination, demoting an
employee without justification, failure to hire
or promote a worthy employee, unwarranted
discipline or abuse (particularly sexual
harassment). Many of these offenses are said to
be the result of illegal discrimination on the
basis of age, gender, religion, race,
nationality, or sexual orientation. Other
offenses are claimed to be a violation of the
individual’s civil rights, or the failure to
accommodate a mental or physical limitation or
disability. Sexual harassment by the employer’s
management or supervisory staff, or by fellow
employees, has grown to include allegations of
same-sex harassment. In addition to injuries
involving sexual abuse, physical, mental or
emotional abuses are also being claimed with
more frequency.
Employers must
take great care to have firm, written policies
and procedures in place to prevent such abuses
and injuries. Various laws and government
agencies hold employers responsible for the
training and implementation of programs to
protect their employees from supervisors and
fellow employees. Modern trends toward
"downsizing," business failures, relocations,
outsourcing and companies phasing out or
selling-off products or services leave more
employees unhappy and likely to file claims.
Often, employees who a company has deemed most
expendable become the most disgruntled and in
the frame of mind to sue. In many other cases,
employees are becoming more aware of their
rights and are gaining the will to seek to have
unacceptable actions and work environments
addressed.
Unfortunately, an
employer’s commitment to eliminate abuses in the
workplace is not enough. The occasional employee
may still sustain or claim to have sustained
injury and the employer’s Comprehensive General
Liability (CGL) policy probably won’t respond.
The type of injuries specifically insured
against in the standard CGL are Bodily Injury
and Property Damage (BI and PD), terms
that are defined in the policy and by numerous
court decisions. Unlike BI and PD claims, most
employment-related injuries are mental,
emotional or financial. Some courts have
extended the definition of Bodily Injury to
include mental or emotional injury, especially
if there are physical manifestations, such as
migraine headaches, vision problems, stomach
problems, etc. However, many do not. Financial
and monetary damages aren’t typically considered
to be Property Damage.
There are other
bars to coverage for employment-related claims
under the CGL. First, the policy’s exclusion of
expected and intended injury is often cited when
adverse employment-related practices exist.
Also, insurers have rushed to eliminate any
exposure to these risks in the CGL policies they
sell. They have, with few exceptions, added an
absolute exclusion of any injury arising out of
or related to employment. Clearly employers must
look elsewhere for coverage.
Various proprietary forms of (ERPL) have been
introduced in recent years, by both specialty
and primary insurers. The Insurance Services
Office, Inc. (ISO) developed a program in 1998.
Since that time, the proprietary forms have
continued to be enhanced in response to market
demands. ISO revised its forms in 2002 to
provide coverage features available in non-ISO
forms.
This form is
written on a claims-made basis and is not
available in an occurrence version.
The above information is
for general informational
purposes only and is
not to be construed
as a recommendation
or advice in any way
shape or form. |
