Does your business have employees? Yes? Then you need to be aware of Employment Practices Liability Insurance (EPLI).
Why Do You Need EPLI in Canada?
Most small and medium sized businesses in Canada do not have this coverage presently. Has your insurance broker told you about this newer coverage?
Your business insurance policy likely excludes claims resulting from wrongful dismissal, invasion of privacy, negligent hiring, harassment, discrimination and other human resource concerns. Most small and medium sized companies do not have this protection.
In 2004, there were 4,400 complaints heard by both the Ontario Human right Commission or the Canadian Human Rights Commission, of which, 3,100 were employment related. – Source – Canadian Insurance magazine Dec 2005.
And there are numerous cases that never go to the Human Rights Commissions and would not be included in that stat.
Do you think that this situation has become better or worse in the past four years? The numbers are most likely to keep going up as our society becomes more litigious
Small businesses with employees are a risk of being sued by employees, former employees and employees that weren’t hired! This type of litigation is costly and time consuming.
MacLean’s Magazine did an article in 2008 about this issue. A local winery was listed as an example – they lost a case and had to pay $90,000 in damages.
You need to look closely at this coverage if you have employees.
A typical policy covers allegations of harassment, wrongful termination and discrimination. Policies can be much wider in scope to include items like:
There are several different insurers offering this coverage in Canada so the scope of the policy may be wider or narrower than this.
A good broker will help you to find the policy that suits your needs.
What Else to Look For?
Definition of Insured should be: as broad as possible including coverage for the entity, directors, officers, all levels of management and employees.
Claim / Loss Definition should include: damages (including punitive), judgments, settlements, legal costs for criminal, civil, regulatory and arbitration proceedings.
Looking for EPL Insurance in Ontario?
The best place to start looking for Employment Practices Liability Insurance is with a business insurance broker. A broker will search the market to find the right coverage from a reputable insurer.
Return to Business Insurance Canada if you just want some business insurance information.
Note: Always speak with a licensed insurance professional about your specific situation. This insurance information is general in nature and the policy wordings always take precedence. It is possible that there are errors and omissions in this website and www.canada-insurance-source.com, or its authors, take no responsibility.
Keep in mind that insurance licensing, legislation, and policies often vary by province and most certainly by country. Canada Insurance Source is a free information source. So use this site to gain a general understanding of insurance with your own area and situation in mind. Make sure you review the "please read" page. Always speak with a licensed insurance professional about your specific situation.
Always speak with a licensed insurance representative about your specific situation.
This site is general in nature and there may be errors or ommissions