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Insurance and Broader Business Solutions in One

Employment Practices Liability Insurance

Beware of Lawsuits from Within
What if a former employee sues for wrongful termination or someone you choose not to hire sues for discrimination? Even businesses with a Human Resources department can struggle to deal with such suits. How would you?

The answer: If you have Employment Practices Liability Insurance (EPLI), you turn these issues over to us. You get to return to the business of running your business. We handle the suit and pay for the cost of defense and settlement up to your coverage limits.

Available EPLI coverage pays for costs associated with a lawsuit brought against you by an employee's accusation of:

  • Discrimination (age, gender, race, etc.)
  • Harassment (emotional distress, sexual harassment, etc.)
  • Inappropriate employment conduct (wrongful termination, refusal to hire)
  • Third-party ADA compliance claims (optional coverage for failure to comply with the Americans with Disability Act)

Claims Made By Guests or Non-Employees

Typical EPLI policy purchased by a hotel operator covers claims for wrongful conduct against his or her employees or applicants for employment. In addition to these claims, a hotel owner is especially vulnerable to claims made by guests and other non-emplovees alleging harassment or discrimination by hotel staff. Standard EPLI forms do not cover this additional exposure.

Sequoia offers an endorsement to its EPLI coverage to add protection against third-party claims. With this third-party endorsement, you are covered if your guests, clients, vendors, suppliers and other visitors sue you for:

  • Discrimination against a legally protected class
  • Harassment against a legally protected class
  • Disability-based discrimination under the ADA

(Legally protected classes include race, color, religion, age, sex, disability, pregnancy, sexual orientation, or national origin)

For the hospitality industry these types of claims can occur despite a well-trained staff and posted rules:

  • The hotel is accused of discrimination after declining lodging to an individual belonging to any legally protected class.
  • A customer sues for harassment after perceiving that they were spoken to in a belittling way by hotel staff
  • The hotel is accused of racial discrimination requiring a cash deposit of guests of a certain ethnic group to pay a cash deposit (rather than paying with a credit card as is asked of other guests)
  • A claim that the hotel failed to provide for a disabled guest in violation of ADA regulations.

Resources to Help Run Your Business
Beyond the financial security that comes with EPLI, you receive free access to dedicated services to help fill any gaps in your employment practices. Go to for:

  • 24/7 access to resources for improving employment practices for your business,
  • Solutions for standard Human Resources activities like downloadable employment forms, manuals, and policy templates,
  • Online management training on employee terminations and preventing employee discrimination,
  • Best Practices Help Line staffed by employment attorneys for consultation on how to effectively manage employee relations

Contact ARM Multi Insurance Services to discuss options for EPLI coverage. Put the right insurance in place for your business and get back to doing what you love.

To print this information, Click here.

    Why do I need EPLI?

    You might feel like your employees are almost family, but they may not see it the same way. Suits from them can come about as a surprise and make you feel betrayed. These types of thoughts may cost you your business:

    • "I have a GL policy, I must be covered" -The typical GL policy does not cover EPL-related claims. For less than $300, the EPLI coverage will provide you with appropriate coverage and many of the employment management resources that you may not have without a dedicated human resources person.

    • "I only have a few employees, so I don't have to worry about them suing me" -Small businesses are common targets, with 40% of EPL-related claims made against employers with a staff of less than 100 people.

    • "I only hire someone new once in a while" - It's not always the employees you already have, these suits can come from a job applicant that you do not actually hire. With the average age of US workers reaching 40.7 years, there are more people that fall into the protected "over age 40" class, making age discrimination the fastest growing and costliest type of lawsuit.

    Insurance programs are underwritten by "A- or higher" rated carriers to ensure financial security and franchisor compliance.
    Administered by ARM Multi Insurance Services & Sequoia Insurance Company.
    CA License #OC73841

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