Payroll Client AccessBenePac Services & Resources
What is Employee Benefits Liability Insurance?
Employee Benefits Liability Insurance protects employers from claims by employees alleging mismanagement of benefits programs. Coverage safeguards against costly lawsuits and judgments related to errors, omissions or negligence in administering employee benefits like health plans, retirement plans and profit-sharing.
How Does Employee Benefits Liability Insurance Work?
Employee Benefits Liability Insurance protects companies against claims made by employees alleging mismanagement of employee benefits plans. It covers legal fees, settlements and judgments related to the administration of benefits like health insurance, life insurance and retirement plans. This type of insurance is crucial for companies with self-insured benefit plans or those that handle employee benefit funds themselves. It safeguards the company's assets and protects against costly employee lawsuits related to benefit plan errors or omissions.
Here's how it works:
- Provides coverage for claims made by employees alleging mismanagement of employee benefits plans
- Covers legal defense costs, settlements and judgments related to benefits administration
- Applies to errors or omissions in administering health insurance, life insurance, retirement plans, etc.
- Protects companies with self-insured benefit plans or those handling employee benefit funds
- Responds when employees allege issues like denial of benefits, untimely processing of claims, miscalculation of benefits, etc.
- Can extend to claims against benefits plan administrators, trustees and fiduciaries
- Typically requires timely reporting of potential claims and circumstances
What Does Employee Benefits Liability Insurance Cover?
Employee Benefits Liability Insurance (EPLI) is a type of insurance policy providing coverage for employers against claims made by employees related to their employee benefits programs. Here's what EPLI insurance typically covers in Wisconsin:
Violations of Employee Retirement Income Security Act (ERISA)
This includes claims related to improper administration or management of employee benefit plans, such as retirement plans, health insurance and disability insurance.
Wrongful Termination
EPLI can cover claims of wrongful termination related to an employee's benefits, such as terminating an employee to avoid paying out benefits or denying benefits after termination.
Discrimination
Claims of discrimination related to employee benefits, such as denying benefits based on age, gender, race or other protected characteristics.
Retaliation
Claims of retaliation against employees who have filed complaints or reported issues related to their employee benefits.
Misrepresentation
Claims of misrepresenting the terms or conditions of employee benefit plans.
Legal Defense Costs
EPLI policies typically cover the legal costs associated with defending against
What is Not Covered?
EPLI policies generally exclude claims related to bodily injury, property damage, intentional/fraudulent acts, violations of non-benefits-related laws, strikes/labor disputes, workers' compensation, unemployment benefits, punitive damages, regulatory fines/penalties and claims arising before or after the policy period.
How Much Does Employee Benefits Liability Insurance Cost for a Business?
The cost of Employee Benefits Liability Insurance (EPLI) varies based on business size, industry and coverage needs. Small businesses face lower premiums due to reduced risk but may pay higher rates relative to their size. Larger businesses incur higher premiums but benefit from negotiating power due to increased risk. Industry disparities also affect costs, with higher-risk sectors facing higher premiums. Additional factors include location, turnover, claims history, risk management and coverage options.
Why Choose BenePac for Employee Benefits Liability Insurance?
With over 40 years of expertise in delivering employee benefits and insurance solutions, BenePac is the ideal choice for Employee Benefits Liability Insurance. Our tailored approach ensures your insurance policy matches your business requirements. Unlike generic options, we conduct thorough risk assessments and operational analyses to craft a package with optimal coverages and limits. Whether you operate a large corporation or a small business, BenePac offers affordable solutions to provide financial security and peace of mind.