Employment Practice Liability (EPL) Insurance
3/5/2009 12:31:05 AM EST
FREE DOWNLOAD: Sections 41.19 through 41.21 of the New Appleman Insurance Law Practice Guide - excerpt of Chapter 41 - Who Is Covered and the Scope of Employment Covered by Employment Practices Liability (EPL) Insurance Policies
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Sections 41.19 through 41.21 of Chapter 41 of the New Appleman Insurance Law Practice Guide, written by L.D. Simmons, II and Lowndes Christopher Quinlan of McGuireWoods LLP, walk you through the considerations that go into determining who is covered and what acts are covered under an EPL policy. EPL policies typically confine coverage to the entity listed in the declarations as the named insured. If so, Section 41.19 warns that a parent, subsidiary, or affiliate of the named insurance would not be covered. The definition of insured often, but not always, includes employees. If so, how the policy defines “employees” is crucial. The Fifth Circuit decision in Andrews Transp. Inc. v. CNA Reinsurance is studied in that regard in Section 41.20.
Some policies limit coverage to claims made by either employees or “claimants” which are typically defined as including employees or applicants for employment. Section 41.20 discusses the issue of whether independent contractors are deemed employees under an EPL policy and warns that the absence of coverage for claims by independent contractors could result in a substantial gap in coverage.
Section 41.21 considers the scope of employment covered by EPL policies. If the employee is doing some act in furtherance of employer’s business, that act will fall within the scope of employment. Conversely, employees acting outside of the scope of their employment will fall outside the policy’s definition of “employees” and thus those acts will not be covered. Some policies add the requirement that the employee or other agent commit a wrongful employment act within their capacity as an employee. The issue then becomes whether the wrongful act was committed within the scope of employment. Section 41.21 includes cases on point.
Simply logon to your account to access Sections 41.19 and 41.21 from the 2008 Edition of New Appleman Insurance Law Practice Guide. If you don’t have an account set up yet, click here to register at our site, also for Free.
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