September 27, 2012
In the past six months, two of my clients have been sued by staff members whose employment was terminated. One doctor is being accused of age discrimination, and the other doctor is charged with harassment. Fortunately for my clients, they each have an insurance product called Employment Practices Liability (EPLI). This insurance plan covers the cost of defending yourself against the charges and the settlement costs of a claim if the judgment goes against you.
I believe, in both of these cases involving my clients, that the accusations were frivolous and unfounded. But we live in a very litigious society. And it is only getting worse! Gender discrimination, age discrimination, and retaliation claims are all on the rise. In America, anybody can sue anybody for whatever reason. And because we are one of the only countries that allows an attorney to take a case on contingency, there is no economic deterrent to the plaintiff for bringing the suit. The fact that the loser usually does not have to pay the winner’s legal costs only contributes to more litigation.
No business owner would consider going without general liability and property insurance, yet employers are more likely to have an employment practices liability claim than a general liability or property claim. And the legal costs just to defend such a claim could easily be 25-30K.
EPLI is not expensive. The annual premium is probably under $1000 for 250K coverage, usually with a deductible of 5K. Employment practices liability insurance covers not only actual but also alleged acts of discrimination, harassment, retaliation, and wrongful termination. You should know that these are not situations that would be covered by your malpractice insurance.
The Hartford, Chubb, and United States Liability Insurance are three companies that I know provide this coverage for dentists. Some of these companies also provide online related resources such as training, forms, and model employment policies. So please check with your insurance agent today and inquire about how to purchase this valuable and necessary protection. The potential financial hit to an uninsured doctor would be devastating.
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