Employment Practices Liability (EPLI) Insurance Calculator
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About Employment Practices Liability Insurance
Employment practices liability insurance (EPLI) protects businesses from employee lawsuits alleging wrongful termination, discrimination, sexual harassment, retaliation, and failure to promote. Employment lawsuits are among the most common and expensive claims businesses face — the average EPLI claim costs over $160,000 when it goes to trial. California and New York have particularly employee-friendly laws and command higher EPLI premiums. Having documented HR policies, an employee handbook, and anti-harassment training can reduce your premium by 20–30% and, more importantly, reduce the likelihood of a claim occurring in the first place.
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Frequently Asked Questions
What does EPLI cover?
EPLI covers legal defense costs and settlements for claims of wrongful termination, discrimination (race, sex, age, disability), sexual harassment, retaliation, failure to promote, and other employment-related allegations.
Do small businesses need EPLI?
Yes. Businesses with as few as one employee can face employment lawsuits. Small businesses are often targeted because they lack the HR infrastructure to handle employment issues properly. EPLI is especially important for growing businesses.
Why does California cost more for EPLI?
California has some of the strongest employee protection laws in the country, including broad anti-discrimination statutes, mandatory leave requirements, and class action risk. This results in higher claim frequency and severity.
Does EPLI cover independent contractors?
Most EPLI policies cover claims from employees only. If you use independent contractors who later claim misclassification as employees, your policy may not cover those claims. Review your policy terms carefully.
How can I reduce my EPLI premium?
Implement a documented employee handbook, conduct annual anti-harassment training, establish a formal grievance process, and document all employment decisions. These steps reduce claim likelihood and can lower premiums.
Results are estimates only. Actual premiums depend on underwriting factors specific to your business. Consult a licensed insurance professional for an accurate quote.