What Are Employment-Related Practices Liability
Insurance Endorsements?

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What Are Employment-Related Practices Liability Insurance Endorsements?

What Are Employment-Related Practices Liability Insurance Endorsements?

What Are Employment-Related Practices Liability Insurance Endorsements?. A employment-related practices liability insurance endorsement can either add, remove or exclude certain coverages. It's a form that becomes part of your insurance policy, altering your policy coverage.

For example, any changes made to the basic policy the commercial insurance carrier files with the state regulators is done by using endorsements. Common changes might include: Changing the business address, adding more coverage, excluding coverage for specific exposures. Employment-Related Practices Liability Endorsements allow you to make these changes - without having to buy another policy or take the chance of having risks go uninsured.

So what are employment-related practices liability insurance endorsements? Read on to discover the many types of endorsements available for employment-related practices liability insurance policies.

What are employment-related practices liability insurance endorsements? Endorsements modify the basic ERPL Policy to either add, delete, or exclude certain types of coverage.

COMMERCIAL CYBER ENDORSEMENTS NUMBERING


So what are employment-related practices liability insurance endorsements?. It is arranged by form number and title and includes a brief explanation of the use of each form. This section does not include any state specific endorsements, changes, or amendments.

The ten-digit numbering sequence of ISO forms and endorsements has a very specific meaning:
  • The first two entries are alphabetical characters that indicate the line of insurance involved. For example, EP denotes Employment-related Practices Liability.
  • The next two digits designate the specific insurance category. Additional detail and information on these categories is in the next section below.
  • The next two digits are the form or endorsement number within the insurance category.
  • The last four digits are the edition date of the form or endorsement expressed in month and year format. These digits are not used in this analysis.

Endorsements are grouped in categories according to their purpose as follows:

Form Endorsement
EP 01Amendatory Endorsements
EP 03Deductible Endorsements
EP 20Additional Insured Endorsements
EP 21Exclusion Endorsements
EP 28Extended Reporting Period Endorsements


What Are EP 01 - Amendatory Endorsements?

The EP 01 - Amendatory Endorsements are as follows:

EP 01 12-Who Is an Insured - Restricted Coverage for Employees

This endorsement restricts employee as insured status to only supervisory and managerial employees. The covered employees can be either current or former employees.

EP 01 13-Who Is an Insured - Outside Director, Trustee, Officer or Member

Provides coverage for insured's employees who serve on boards, are officers of, are trustees, or are members of not- for-profit organizations but only if serving with written permission from the named insured.

EP 01 14-Counsel Selection

This endorsement gives the insured the right to approve or disapprove the selection of defense counsel. Any disapproval must be reasonable.

EP 01 15-Named Employee Exclusion

Specifically named individuals can be excluded as insureds using this endorsement. This means that, while the listed persons are not covered for their actions, the named insured would continue to be covered for suits brought against it for supervisory or management negligence relating to the named individuals.

EP 01 17-Liability to Your Customers or Clients

This endorsement expands coverage to claims brought by the insured organization's customers/clients for alleged wrongful acts but only if due to discrimination.

Example: A restaurant employee refuses to seat a family because she believes they are illegal immigrants. The restaurant is sued by the family for discrimination and public humiliation. If this endorsement is attached, the coverage form would respond to the allegation.

EP 01 18-Liability to Independent Contractors

This endorsement expands coverage to include claims brought by independent contractors for alleged wrongful acts but only if due to discrimination.

Example: Patty submits a bid to paint lettering for weekly specials on Fish and Chips, LLC's windows. She does not receive the job even though she later finds out her price was lower and her qualifications better. The difference is that the winning bidder was a white male while she is a black female. She sues Fish and Chips, LLC who will be defended for the action if this endorsement is attached.

EP 01 19-Liability to Volunteers

This endorsement expands coverage to include claims brought by volunteers for alleged wrongful acts but only if due to discrimination.

EP 01 20-Liability to Non-Employees

This endorsement expands coverage to claims brought by non-employees for alleged wrongful acts but only if due to discrimination or harassment. The triggering act must be work related.

EP 01 21-Nuclear Energy Liability Exclusion Endorsement (Broad Form)

This is a mandatory form that excludes coverage under the ERPL for any liability related to nuclear and radioactive incidents. It is similar to the IL 00 21-Nuclear Energy Liability Exclusion Endorsement which is mandatory on most of ISO's liability coverages.

EP 01 33-Amendment of Consent to Settle

This expansion of coverage softens the Consent to Settle condition. Instead of requiring the named insured to cover the difference between the proposed but declined settlement and the final settlement, the named insured can select a percentage of the settlement for which it is responsible. This option may be attractive to insured entities with a high incentive to aggressively fight ERPL claims.

EP 01 34-Amendment of Coverage Territory - Worldwide Coverage

The policy's coverage territory is expanded anywhere in the world except for countries under United States trade or economic sanction. If the insurance company cannot participate in the defense in any of those countries the insured will be reimbursed by the carrier but still subject to the policy limit.

EP 01 35-Amendment of Coverage Territory - Worldwide Coverage Except For Specified Countries

This is identical to EP 01 34 except that a schedule is provided on which countries are listed that are NOT covered.

EP 01 36-Amendment of Coverage Territory - Additional Scheduled Countries

The policy coverage territory is expanded to include any country listed in the endorsement schedule. Claims brought anywhere in the world are also covered but only if the suit is brought in the expanded coverage territory. If the insurance company cannot participate in the defense in any of those countries the insured will be reimbursed by the carrier but still subject to the policy limit.

EP 01 37-Malicious Prosecution Coverage

The ERPL coverage is expanded to include malicious prosecution claims filed by an insured's employees.

What Are EP 03 - Deductible Endorsements?

The EP 03 - Deductible Endorsements are as follows:

EP 03 01-Co-Payment Liability Insurance

The deductible provision is replaced by the co-payment provisions in this endorsement. A percentage and a maximum amount of co-payment must be entered in the schedule.

EP 03 02--Deductible and Co-Payment Liability Insurance

This endorsement may be added to require that the named insured fulfill its deductible requirement and then still pay a percentage of the remaining amount of the loss subject to the maximum co-payment amount.

What Are EP 20 - Additional Insured Endorsements?

The EP 20 - Additional Insured Endorsements are as follows:

EP 20 01-Additional Insured - Designated Person or Organization

With this endorsement, the named insured may add as additional insured any designated person or organization. It is generic in nature and should be used when no other more appropriate additional insured endorsement is available.

EP 20 02-Additional Insured - Controlling Interests

This endorsement should be used when there is a need to add a person or an organization having financial control over the named insured as an additional insured.

EP 20 03-Additional Insured - Volunteers

This endorsement adds volunteers to the Who Is an Insured Section of the policy.

EP 20 04-Additional Insured - Independent Contractors

This endorsement adds independent contractors to the Who Is an Insured Section of the policy. It does not make them employees.

What Are EP 21 - Exclusion Endorsements?

The EP 21 - Exclusion Endorsements are as follows:

EP 21 01-Exclusion - Designated Ongoing Operation(s)

With this endorsement, the insurer may exclude any claims involving specific operations. The operations are excluded at only the listed location. If no location is listed, the listed operations are excluded wherever they are conducted. This can be used to help make an otherwise unacceptable risk, acceptable.

What Are EP 28 - Extended Reporting Period Endorsements?

The EP 28 - Extended Reporting Period Endorsements are as follows:

EP 28 01-Extended Reporting Period Endorsement

Because the Employment-related Practices Liability policy is on a claims-made basis, the reporting period may be extended via the purchase of this endorsement. When this endorsement is purchased, the reporting period is extended to three years.

An insured has up to 30 days after the end of the policy period or after any termination, to notify the insurer in writing of the intent to purchase this endorsement.

The charge made for the application of this endorsement is up to the discretion of the insurer; however, parameters are set for the maximum in making this additional premium charge.

What Are Employment-Related Practices Liability Insurance Endorsements? - The Bottom Line

What are employment-related practices liability insurance endorsements? An endorsement alters the ERPL Policy and becomes part of your commercial insurance agreement, and it remains in force until the contract term expires.

The only exception to the above rule is if the employment-related practices liability endorsement has a specific or limited term to which the endorsement is valid. It may renew under the same terms and conditions of the rest of your policy.

Additional Commercial Insurance Endorsements Information

Learn about small business commercial endorsements that add, remove, or change your policy's coverage by altering the standardized coverage form.


Commercial Insurance Endorsements

So commercial insurance endorsements allow you to customize your policy to better fit your business insurance needs without having to buy a new policy.

So business insurance endorsements can either modify the basic policy by removing coverages that you don’t need, or remove one or more exclusions, adding those coverages back into the policy.

There are many types of commercial insurance endorsements - and while some favor the insurer (by excluding coverage) and some benefit the insured (by adding coverage), below is a list of some of the most common uses for business insurance endorsements:


  • Additional Insured: This is one of the most common endorsements that adds someone other than you to your insurance policy. It is typically required by some sort of contract. Common additional insureds are landlords, general contractors, vendors or customers.
  • Administrative Changes: Newly issued policies can include mistypes, misspellings, or missing words altogether. To correct these errors, the insurer would add an endorsement, rather then having to cancel and issue a new policy. If a policyholder changes their name, an endorsement would reflect that too.
  • Changing Or Adding Addresses: This endorsement covers any change to the insured's property like moving your office to a new location, or expanding to a another location.
  • Deductible Changes: This endorsement manages who can change your deductible as well as when and how much it can be changed.
  • Increased Limits: Occasionally companies need to add endorsements to increase the limits of insurance. For example, you'd use an endorsement to extend workers' compensation benefits not covered by state law. Or, to get a contract you need higher limits on your general liability policy.

Making a policy change usually affects your insurance premium. Anytime coverage is altered there is likely a cost associated with how the policy premium is calculated. Adding coverage usually makes the premium increase, while excluding coverage can reduce the premium you pay.


Types Of Small Business Insurance - Requirements & Regulations

Perhaps you have the next great idea for a product or service that you know will appeal to your local area. If you've got a business, you've got risks. Unexpected events and lawsuits can wipe out a business quickly, wasting all the time and money you've invested.

Operating a business is challenging enough without having to worry about suffering a significant financial loss due to unforeseen and unplanned circumstances. Small business insurance can protect your company from some of the more common losses experienced by business owners, such as property damage, business interruption, theft, liability, and employee injury.

Purchasing the appropriate commercial insurance coverage can make the difference between going out of business after a loss or recovering with minimal business interruption and financial impairment to your company's operations.

Small Business Information

Insurance is so important to proper business function that both federal governments and state governments require companies to carry certain types. Thus, being properly insured also helps you protect your company by protecting it from government fines and penalties.

Small Business Insurance Information

In the business world, there are many risks faced by company's every day. The best way that business owners can protect themselves from these perils is by carrying the right insurance coverage.

The The National Association of Insurance Commissioners (NAIC) is the U.S. standard-setting and regulatory support organization. Through the NAIC, state insurance regulators establish standards and best practices, conduct peer review, and coordinate their regulatory oversight.

Commercial insurance is particularly important for small business owners, as they stand to lose a lot more. Should a situation arise - a lawsuit, property damage, theft, etc. - small business owners could end up facing serious financial turmoil.

According to the SBA, having the right insurance plan in place can help you avoid major pitfalls. Your business insurance should offer coverage for all of your assets. It should also include liability and casual coverage.

Types Of Small Business Insurance

Choosing the right type of coverage is absolutely vital. You've got plenty of options. Some you'll need. Some you won't. You should know what's available. Once you look over your options you'll need to conduct a thorough risk assessment. As you evaluate each type of insurance, ask yourself:

  • What type of business am I running?
  • What are common risks associated with this industry?
  • Does this type of insurance cover a situation that could feasibly arise during the normal course of doing business?
  • Does my state require me to carry this type of insurance?
  • Does my lender or do any of my investors require me to carry this type of policy?

A licensed insurance agent or broker in your state can help you determine what kinds of coverages are prudent for your business types. If you find one licensed to sell multiple policies from multiple companies (independent agents) that person can often help you get the best insurance rates, too. Following is some information on some of the most common small business insurance policies:

Business Insurance Policy Type What Is Covered?
General Liability InsuranceWhat is covered under commercial general liability insurance? It steps in to pay claims when you lose a lawsuit with an injured customer, employee, or vendor. The injury could be physical, or it could be a financial loss based on advertising practices.
Workers Compensation InsuranceWhat is covered under workers compensation insurance? This type of insurance protects a business and its owner(s) from claims by employees who suffer a work-related injury, illness or disease. Workers comp typically provides the injured employee with benefits to cover medical expenses, a portion of his/her lost wages, rehabilitation costs if applicable, and permanent partial or permanent total disability.
Product Liability InsuranceWhat is covered under product liability insurance? I pays an injured party's settlement or lawsuit claim arising from a defective product. These are usually caused by design defects, manufacturing defects, or a failure to provide adequate warning or instructions as to how to safely use the product.
Commercial Property InsuranceWhat is covered under business property insurance? General liability policies don't cover damages to your business property. That's what commercial property insurance is for. It protects all of the physical parts of your business: your building, your inventory, and your equipment, giving you the funds you need to replace them in the event of a disaster. If you work from home, you might consider a Home Based Business Insurance policy instead.
Business Owners Policy (BOP)What is covered under a business owners policy (BOP)? This is a policy designed for small, low-risk businesses. It simplifies the basic insurance purchase process by combining general liability policies with business income and commercial property insurance.
Commercial Auto InsuranceWhat is covered under business auto insurance? This type of insurance covers automobiles being used for business purposes. This could include a fleet of business-only vehicles or a single company car. In some cases it might cover your car or your employee's car while they're being used for business. These policies have much higher limits, ensuring you can cover your costs if one of these vehicles gets into an accident.
Commercial Umbrella PoliciesWhat is covered under commercial umbrella insurance? This type of policy is a sort of "gap" insurance. It covers your liability in the event that a court verdict or settlement exceeds your general liability policy limits.
Liquor Liability InsuranceWhat is covered under liquor liability insurance? It covers bodily injury or property damage caused by an intoxicated person who was served liquor by the policy holder.
Professional Liability (Errors & Omissions)What is covered under professional liability insurance? This type of business insurance is also known as malpractice oe E&O. It covers the damages that can arise from major mistakes, especially in high-stakes professions where mistakes can be devastating.
Surety BondWhat is covered under surety bonds? Bonding is a contract where one party, the SURETY (who assures the obligee that the principal can perform the task), guarantees the performance of certain obligations of a second party, the PRINCIPAL (the contractor or business who will perform the contractual obligation), to a third party, the OBLIGEE (the project owner who is the recipient of an obligation).


Who Needs General Liability Insurance? - Virtually every business. A single lawsuit or settlement could bankrupt your business five times over. You might also need this policy to win business. Many companies and government agencies won't do business with your company until you can produce proof that you've obtained one of these policies.

Business Insurance Required by Law
Small Business Commercial Insurance

If you have any employees most states will require you to carry worker's compensation and unemployment insurance. Some states require you to insure yourself even if you are the only employee working in the business.

Your insurance agent can help you check applicable state laws so you can bring your business into compliance.

Other Types Of Small Business Insurance

There are dozens of other, more specialized forms of small business insurance capable of covering specific problems and risks. These forms of insurance include:

  • Business Interruption Insurance
  • Commercial Flood Insurance
  • Contractor's Insurance
  • Cyber Liability
  • Data Breach
  • Directors and Officers
  • Employment Practices Liability
  • Environmental or Pollution Liability
  • Management Liability
  • Sexual Misconduct Liability

Whether you need any or all of these policies will depend on the results of your risk assessment. For example, you probably don't need an environmental or pollution policy if you're running an IT company out of a leased office, but you would need data breach and cyber liability policies to fully protect your business.

Also learn about small business insurance requirements for general liability, business property, commercial auto & workers compensation including small business commercial insurance costs. Call us (855) 767-7828.

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