Employment Practices Liability Insurance in the #MeToo Era
Every business has insurance, whether it’s medical insurance for employees, property insurance for the building, or liability insurance for the actions of its directors, officers, and employees. While the insurance landscape is constantly evolving, recent social progress has led to rapid changes that will have huge implications for the insurance industry. Due to the major impact of the #MeToo movement, many insurance companies are rethinking how or if they will offer Employment Practices Liability Insurance (EPLI) to certain industries.
Betterley Risk Consultants, a risk management consulting firm, recently released a report that found some of the world’s largest insurers were rethinking their approach to EPLIC. Insurance companies are now considering blacklisting entire industries with a reputation for rampant sexual harassment. As the #MeToo movement encourages more victims of sexual harassment to come forward, insurance companies are looking to adjust their policies to mitigate the increased risk.
Betterley Risk Consultants revealed that 10 of the 32 largest insurers will no longer offer EPLI coverage to financial firms and eight won’t sell policies to the media and entertainment industry. Other industries that will have a hard time finding a EPLI policy include car dealerships, law firms, or any industry where high-ranking executives have previously been able to get away with harassment as long as they continue to perform their jobs well.
Insurers that provide coverage to these industries are taking precautions to make sure any risk is properly assessed before issuing a policy. Among other things, insurers now expect business owners to establish policies and procedures for reporting and dealing with workplace harassment in order to obtain a policy. Insurers are also carefully analyzing the wording of their policies and endorsements to ensure that it properly takes into account the changing legal landscape.
Policy Drafting Advice
An ever-changing insurance market requires the experience of insurance drafting lawyers with forward-thinking strategies. At Chasnoff Mungia Pepping & Stribling, we advise both foreign and domestic insurers on EPLI matters and other complex policy drafting and wording issues. We stay up to date with the latest trends in the insurance industry so we can advise our clients on emerging risks.