Employee Liability

Employee Liability Insurance, also known as Employer's Liability Insurance, is a crucial coverage that protects business owners from costly lawsuits resulting from work-related injuries or illnesses suffered by their employees. Without this insurance, business owners would be responsible for paying legal costs out of pocket, which can be a significant financial burden.

Employer's Liability Insurance is typically included as part of a workers' compensation insurance policy. However, in monopolistic states, business owners may be required to obtain it separately.

Small business owners should consider purchasing Employer's Liability Insurance to safeguard their businesses from potential lawsuits related to employee injuries or illnesses. By having this coverage, they can mitigate the costs of attorney fees, settlements, and judgments that may arise from such claims.

In most states, workers' compensation insurance is mandatory, providing benefits to employees for medical bills, ongoing care, and lost wages resulting from work-related injuries or illnesses. However, employees still retain the right to sue their employers if they believe the provided workers' compensation benefits are insufficient. This is where Employer's Liability Insurance plays a crucial role, as it helps cover the legal costs associated with these lawsuits.

Employer's Liability Insurance covers different types of claims, including third-party lawsuits brought by employees due to injuries or illnesses caused by their job, loss of consortium lawsuits filed by spouses claiming a loss of marital benefits, consequential bodily injury lawsuits in which non-employees are affected by an employee's injury or illness, and dual-capacity lawsuits involving employers who have a second relationship to the employee.

It is important to note that Employer's Liability Insurance is not the same as workers' compensation insurance. While workers' comp insurance provides benefits to employees for medical expenses and lost wages, Employer's Liability Insurance covers legal costs for business owners. It is also distinct from Employment Practices Liability Insurance (EPLI), which protects businesses from employment-related claims, such as wrongful termination, discrimination, and harassment.

To obtain Employer's Liability Insurance, business owners can typically find it in their workers' compensation insurance policy. However, for those in monopolistic states or those who obtained workers' compensation coverage through a state fund, a separate policy specifically for Employer's Liability Insurance may be necessary. Business owners can inquire about this coverage by adding an endorsement to their existing general liability insurance policy.

At Allcom Insurance, we specialize in workers' compensation insurance and can provide you with a quote that includes Employer's Liability Insurance to protect your business from potential lawsuits related to employees' work-related injuries or illnesses. Contact us today to discuss your insurance needs and how we can assist your business.