For most of the history of employment practices liability (EPL), the process
has been fairly predictable—something goes wrong, someone reports it, and then the
organization (and eventually the insurer) reacts. The tools got better over time: better
investigations, better documentation, and better training modules. But the model itself
stayed the same.
What we've learned in recent years, though, is that EPL issues don't just suddenly happen. They build. They develop slowly through small misunderstandings, trust gaps, or cultural drift that rarely show up in official records. By the time an allegation is made, most of the real damage is already in motion, sometimes months earlier.
That recognition marks the end of what I'd call the reactive era. Not because anyone declared it was over, but because the data now makes it impossible to ignore how early these patterns begin.
What the Early Signals Actually Tell Us
Throughout my academic work—studying communication, intercultural
competence, adaptation, and how people navigate workplace expectations—I continue to
see the same phenomenon: EPL trouble tends to start where relationships start to
thin out. It might begin in any number of ways, such as the following.
An employee feels slightly unsure about a supervisor's expectations.
A manager tries to communicate a change but does so in a way that feels abrupt or inconsistent.
A team begins losing trust because the workload doesn't match the level of support it expects.
None of these moments looks like risk at the time, and most people wouldn't label them as anything more than
workplace noise. But when those patterns accumulate, they create the conditions in
which allegations or complaints eventually grow. The early signals are there;
they've just been invisible because no one had a way to track them or even know they
existed.
Why Reactive Models No Longer Fit Insurer Needs
The reactive model still works for what it was designed for—responding to allegations after they arise. But today's workforce communicates differently, expects more clarity, and often reacts strongly to perceived unfairness or inconsistency. Hybrid work, generational expectations, and rapid organizational change all amplify the chance for misalignment.
The challenges that EPL professionals face today are more
relational and behavioral than procedural. But historic tools were largely built for
the procedural side: They monitor event-care procedures, not the build-up to events.
So, we've ended up trying to manage current workforce dynamics with tools designed
for a very different era of work, without giving thought to how EPL preventative
measures might impact loss ratios.
How Prevention Data Changes the EPL Conversation
What makes the current shift possible is not a trend or a philosophy but the simple fact that workforce conditions can now be measured—not perfectly, of course, and not down to exact predictions, but well enough to see how groups are doing long before anything escalates.
Patterns in trust, communication clarity, fairness perceptions,
and team cohesion often shift months before a formal complaint appears. Those shifts
don't "prove" anything, but they give organizations a chance to notice that
something is changing and explore why. What makes prevention data transformative is
that it sheds light on the pre-incident phase of EPL risk, which is a phase that has
always existed but was largely invisible.
Building a Preventive Mindset Inside EPL Risk Management
A preventive mindset doesn't eliminate the need for investigations
or hotline reporting. Those tools are still essential, but early workforce insight
gives them context. It helps organizations know where issues may be emerging and
helps risk and human resources (HR) teams act sooner.
Many companies already have solid HR resources in place: internal
teams, external advisers, and reporting channels. What they often lack is a way to
understand where to focus those resources or why certain parts of the workforce seem to be
struggling.
Ongoing workforce insight fills that gap. It can surface small patterns—a team that feels unheard, a manager whose communication style is wearing people down, or simply a rise in confusion about expectations. Those indicators, while subtle, give leaders a chance to check in before the situation hardens into resentment or a formal complaint.
When prevention data informs traditional EPL tools, those tools
actually become more effective. A hotline becomes more than a last resort; it
becomes part of a supportive system. External advisers aren't stepping into crises
cold; they're coaching leaders through manageable issues early. Even training feels
more targeted when it's connected to real conditions happening inside the
organization.
In short, prevention data doesn't replace existing EPL tools; it
makes them work in the environment that we actually live in now.
What this Means for the Commercial Insurance Industry
This shift has obvious implications for insurers and risk
professionals. The earlier that a workforce issue is seen, the more options exist to
reduce its severity or even prevent it from becoming a claim. That naturally
improves loss performance, strengthens defensibility, and adds a practical form of
risk differentiation.
It also positions insurers and brokers as partners in operational
stability rather than just claims responders. For employers, the benefits show up
both in culture and in cost control.
The EPL landscape isn't getting simpler, but our ability to see it
earlier is getting better, which alone changes the equation.
Conclusion
If EPL risk once felt like something that simply arrived without warning, prevention data shows us
that isn't quite true. The warning signs have always been there—we just haven't had
the tools to make sense of them. We are now moving into a new era where
organizations can intervene earlier, understand their people more clearly, and
address small issues before they become defining ones. That doesn't eliminate the
need for reactive processes; it just means that we no longer have to rely on them as
our primary strategy.
The reactive era is ending. What follows is a more informed, more
proactive, and ultimately more human approach to EPL risk.
Opinions expressed in Expert Commentary articles are those of the author and are not necessarily held by the author's employer or IRMI. Expert Commentary articles and other IRMI Online content do not purport to provide legal, accounting, or other professional advice or opinion. If such advice is needed, consult with your attorney, accountant, or other qualified adviser.
For most of the history of employment practices liability (EPL), the process has been fairly predictable—something goes wrong, someone reports it, and then the organization (and eventually the insurer) reacts. The tools got better over time: better investigations, better documentation, and better training modules. But the model itself stayed the same.
What we've learned in recent years, though, is that EPL issues don't just suddenly happen. They build. They develop slowly through small misunderstandings, trust gaps, or cultural drift that rarely show up in official records. By the time an allegation is made, most of the real damage is already in motion, sometimes months earlier.
That recognition marks the end of what I'd call the reactive era. Not because anyone declared it was over, but because the data now makes it impossible to ignore how early these patterns begin.
What the Early Signals Actually Tell Us
Throughout my academic work—studying communication, intercultural competence, adaptation, and how people navigate workplace expectations—I continue to see the same phenomenon: EPL trouble tends to start where relationships start to thin out. It might begin in any number of ways, such as the following.
None of these moments looks like risk at the time, and most people wouldn't label them as anything more than workplace noise. But when those patterns accumulate, they create the conditions in which allegations or complaints eventually grow. The early signals are there; they've just been invisible because no one had a way to track them or even know they existed.
Why Reactive Models No Longer Fit Insurer Needs
The reactive model still works for what it was designed for—responding to allegations after they arise. But today's workforce communicates differently, expects more clarity, and often reacts strongly to perceived unfairness or inconsistency. Hybrid work, generational expectations, and rapid organizational change all amplify the chance for misalignment.
The challenges that EPL professionals face today are more relational and behavioral than procedural. But historic tools were largely built for the procedural side: They monitor event-care procedures, not the build-up to events. So, we've ended up trying to manage current workforce dynamics with tools designed for a very different era of work, without giving thought to how EPL preventative measures might impact loss ratios.
How Prevention Data Changes the EPL Conversation
What makes the current shift possible is not a trend or a philosophy but the simple fact that workforce conditions can now be measured—not perfectly, of course, and not down to exact predictions, but well enough to see how groups are doing long before anything escalates.
Patterns in trust, communication clarity, fairness perceptions, and team cohesion often shift months before a formal complaint appears. Those shifts don't "prove" anything, but they give organizations a chance to notice that something is changing and explore why. What makes prevention data transformative is that it sheds light on the pre-incident phase of EPL risk, which is a phase that has always existed but was largely invisible.
Building a Preventive Mindset Inside EPL Risk Management
A preventive mindset doesn't eliminate the need for investigations or hotline reporting. Those tools are still essential, but early workforce insight gives them context. It helps organizations know where issues may be emerging and helps risk and human resources (HR) teams act sooner.
Many companies already have solid HR resources in place: internal teams, external advisers, and reporting channels. What they often lack is a way to understand where to focus those resources or why certain parts of the workforce seem to be struggling.
Ongoing workforce insight fills that gap. It can surface small patterns—a team that feels unheard, a manager whose communication style is wearing people down, or simply a rise in confusion about expectations. Those indicators, while subtle, give leaders a chance to check in before the situation hardens into resentment or a formal complaint.
When prevention data informs traditional EPL tools, those tools actually become more effective. A hotline becomes more than a last resort; it becomes part of a supportive system. External advisers aren't stepping into crises cold; they're coaching leaders through manageable issues early. Even training feels more targeted when it's connected to real conditions happening inside the organization.
In short, prevention data doesn't replace existing EPL tools; it makes them work in the environment that we actually live in now.
What this Means for the Commercial Insurance Industry
This shift has obvious implications for insurers and risk professionals. The earlier that a workforce issue is seen, the more options exist to reduce its severity or even prevent it from becoming a claim. That naturally improves loss performance, strengthens defensibility, and adds a practical form of risk differentiation.
It also positions insurers and brokers as partners in operational stability rather than just claims responders. For employers, the benefits show up both in culture and in cost control.
The EPL landscape isn't getting simpler, but our ability to see it earlier is getting better, which alone changes the equation.
Conclusion
If EPL risk once felt like something that simply arrived without warning, prevention data shows us that isn't quite true. The warning signs have always been there—we just haven't had the tools to make sense of them. We are now moving into a new era where organizations can intervene earlier, understand their people more clearly, and address small issues before they become defining ones. That doesn't eliminate the need for reactive processes; it just means that we no longer have to rely on them as our primary strategy.
The reactive era is ending. What follows is a more informed, more proactive, and ultimately more human approach to EPL risk.
Opinions expressed in Expert Commentary articles are those of the author and are not necessarily held by the author's employer or IRMI. Expert Commentary articles and other IRMI Online content do not purport to provide legal, accounting, or other professional advice or opinion. If such advice is needed, consult with your attorney, accountant, or other qualified adviser.