Business Insurance Basics: What Every Business Owner Needs to Know

Deciding to hire an employee (or multiple ones) is a big step for a business owner. Hiring one or two people can really help your business grow. You may be able to make it bigger than you ever imagined.

However, hiring employees is more than just finding someone to work with you. You need to talk to your tax professional to ensure that you are paying adequate taxes. You also need to talk to your insurance company. You are going to need to have Employment Practices Liability, also known as EPLI.

So, What is Employment Practices Liability Insurance?

EPLI is used to cover businesses against any claims that they may receive by their employees. These include claims from workers who feel like their legal rights have been violated in some way.

What Kind of Claims Could I Be Facing?

EPLI will protect your business against employee claims for many reasons. These include:

• Discrimination
• Holding someone back from a position that they deserve
• Wrongful termination or even wrongful discipline
• Sexual harassment
• Breach of contract
• Emotional distress
• And other employment-related issues that may occur

Why Was Employment Practices Liability Insurance created?

EPLI was created because the amount of lawsuits that are brought against employers is on the rise. Though this used to only occur with big companies, the truth is that smaller businesses aren’t immune.

Even though larger companies may be able to handle a lawsuit occasionally, one lawsuit could bankrupt a smaller one. This is the reason why Employment Practices Liability Insurance was created.

How Does Employment Practices Liability Insurance Protect Employers?

EPLI protects your business against any lawsuits that may be brought on by your employees. Your EPLI policy will cover any legal costs that may occur. They will pay whether you win or lose.

Unfortunately, even one lawsuit could destroy your business and shut you down. You could be facing fines and legal fees, costing your business thousands of dollars that it needs to keep going.

What does Employment Practices Liability Insurance Cost?

Depending on your insurance, EPLI may be added to your Businessowners policy, though some companies offer it as a stand-alone policy.

Either way, the cost of EPLI depends on multiple factors, including:

• How many employees you have
• Percentage of employee turnover
• Whether you have clearly established rules and practices that are being followed
• Whether you have had any lawsuits against your company before

What Else Can You Do To Protect Your Business?

There are plenty of things that you can do to protect your business. Here are some things that you should do to help.

• Be diligent in your hiring process. You are going to want to hire the best employees possible. Take your time to find people that are going to fit in well, and follow the rules.
• Have clear rules in your employee handbook. Employee handbooks are made for a reason: to protect your business and your employees. Everyone works better if they know exactly what is expected of them.
• Discourage bullying and discrimination. You need to have a clear no bullying and discrimination policy in your business so everyone feels like they are being treated fairly.
• Deal with problems right away. If you are noticing a conflict between your employees, you need to talk to them right away. Unresolved conflict could cause trouble down the line, with one (or both) employees coming after your business.
• Protect your business with insurance. Insurance is there for a reason. Though you may want to save some money, ultimately, you need to have enough insurance to help you in case anything goes wrong!

The best way that you can protect your business is by having enough insurance. It can be hard to know how much you really need so it is important to talk to a professional.

If you want to make sure that you (and your business) are protected, don’t hesitate to contact us today. We will be able to discuss your needs so that your business is protected.