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employment practices liability insurance (EPLI)

employment practices liability insurance (EPLI) is a type of liability insurance covering wrongful acts arising from the employment process.

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The most frequent types of claims covered under such policies include: wrongful termination, discrimination, sexual harassment, and retaliation. In addition, the policies cover claims from a variety of other types of inappropriate workplace conduct, including (but not limited to) employment-related: defamation, invasion of privacy, failure to promote, deprivation of a career opportunity, and negligent evaluation. The policies cover directors and officers, management personnel, and employees as insureds. The most common exclusions are for bodily injury (BI), property damage (PD), and intentional/dishonest acts. EPLI policies are written on a claims-made basis. The forms contain "shrinking limits" provisions, meaning that insurer payment of defense costs—which are often a substantial part of a claim—reduce the policy's limits. This approach contrasts with commercial general liability (CGL) policies, in which defense is covered in addition to policy limits. Although EPLI is available as a stand-alone coverage, it is also frequently sold as part of a management liability package policy. In addition to providing directors and officers (D&O) and fiduciary liability insurance, management liability package policies afford the option to cover employment practices liability (EPL).

Related Terms


Defamation is any written or oral communication about a person or thing that is both untrue and...

Discrimination is the act or process of evaluating insurable risks and determining premiums on the...

Directors and officers (D&O) liability insurance is a type of liability insurance covering...

Errors and omissions (E&O) insurance protects the insured against liability for committing an error...

Fiduciary liability is the responsibility on trustees, employers, fiduciaries, professional...

Management liability insurance covers exposures faced by directors, officers, managers, and...

Personal injury coverage is found under the commercial general liability and homeowners policies....

Retaliation claims result when an employee alleges discrimination based on protected status (e.g.,...

The shrinking limits defense provision provides that the expenditure of defense costs associated...