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Employment Practice Liability



Our "A++" rated carrier has crafted the following coverage for claims of wrongful termination, sexual harassment, discrimination, invasion of privacy, false imprisonment, breach of contract, emotional distress, and wage and hour law violations.

Ineligible Employment Practices Liability

Please note we cannot offer coverage to the following:

  • Over 500 employees (part time and seasonal count as half an employee)

  • More than two employment practices claims or circumstances in the last five years

  • Adult entertainment, agriculture, aviation, bars/taverns, casinos, coal mining, schools, construction companies and hospitals

  • Risks located in LA or WV

Available Coverage for Employment Practices Liability

  • Fair Labor Standards Act (FLSA) - $100,000 sub-limit for defense costs and loss (available in most jurisdictions)

  • Defense and settlement provision (Hammer Clause) softened to cover 75 percent of defense costs and loss after insured’s final refusal to consent to settle a claim

  • Defense outside the limit up to 200 employees if a $500,000 limit or higher is chosen (does not apply to violations of FLSA)

  • Full Prior Acts coverage for claim-free accounts for most states and classes

  • Punitive damages with most favorable venue wording included in the definition of loss (available in most jurisdictions)

  • Front and back pay included in the definition of loss

  • “For” wording applies to bodily injury/property damage exclusion

  • Wrongful Act definition expanded to included coverage for the negligent violation of the Uniformed Services Employment and Reemployment Rights Act (USERRA)

  • Independent contractors are included in the definition of employee Modified severability                                                                                          Spousal liability extended to domestic partners

  • Final adjudication wording for fraud exclusion

  • Defense costs coverage for breach of express employment contract

  • Retaliation carve backs for many exclusions

  • Defense costs coverage for claims involving the modification of real property



Claim Example for Employment Practices Liability

Discrimination/Wrongful Termination: A female Marketing Manager took leave subject to the Family Medical Leave Act (FMLA) upon the birth of her first child. She was terminated one month after her return to work for poor work performance and the company eliminated her position. There was no documentation of poor performance prior to her FMLA leave.

Third Party Liability: A blind customer entered a local grocery store with his guide dog. The manager of the meat/ deli department asked the customer to take his dog outside because he thought the dog presented a health hazard. The customer sued for violation of the Americans with Disabilities Act.

Internet/Email Liability: An employee who intended to email a pornographic joke to only a single recipient accidentally pressed the wrong button, sending the off-color joke to the company’s entire workforce. The employer made the employee send a follow-up email apologizing to the workforce. Two months later, during a company downsizing, an employee sued for a hostile work environment and used the email as evidence.


Spousal Liability: The president of a company was being threatened with a sexual harassment suit by one of his employees. The president decided to transfer most of his assets into his wife’s name in order to avoid being personally sued and subjecting his personal assets to any possible claim settlement against him. The employee later sued the president for sexual harassment. The suit named both the president and the president’s wife because of her ownership interest in the president’s assets. These assets were later subjected to the settlement provisions.

Retaliation: An African American employee of a barge repair and painting firm complained to management that some of his coworkers were using racial slurs and jokes. His supervisor transferred him to an inside warehouse position at a reduced hourly rate stating that it would be better for him to work alone rather than be exposed to those workers. The employee later sued for discrimination and retaliation for reporting the discrimination.


You must be an appointed USASIA Insurance Services retailer to use these programs. Quotes obtained via these programs will only be bound IF you are a previously appointed retailer with USASIA. PRIOR TO BINDING, check with your branch to determine any and all applicable taxes and fees. If you need additional pricing considerations on any web quote received via these programs or if your submission is declined, please call your USASIA representative.

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