Employment Practices Liability Insurance (EPLI)

Is a type of business liability insurance that protects employers against lawsuits and claims related to how employees are treated in the workplace.

It helps cover the legal and financial costs of employment-related claims brought by:

  • Current employees
  • Former employees
  • Job applicants

EPLI has become increasingly important because employment lawsuits can be expensive even when the employer wins the case.  

What EPLI insurance covers

EPLI generally covers claims involving workplace rights, discrimination, and employment practices.

Common covered claims include:

1. Wrongful termination

Claims that an employee was fired illegally or unfairly.

2. Workplace discrimination

Claims involving alleged discrimination based on:

  • Race
  • Gender
  • Age
  • Religion
  • Disability
  • Pregnancy
  • Sexual orientation
  • Other protected categories

3. Sexual harassment and workplace harassment

Coverage for claims involving:

  • Sexual harassment
  • Hostile work environment
  • Bullying or retaliation allegations

4. Retaliation claims

If an employee claims they were punished for:

  • Reporting misconduct
  • Filing complaints
  • Whistleblowing
  • Participating in investigations

5. Failure to hire or promote

Claims from applicants or employees alleging unfair hiring or promotion practices.

6. Employment-related defamation or privacy violations

Some policies cover claims involving:

  • Defamation
  • Invasion of privacy
  • Improper background checks

7. Legal defense costs

One of the biggest benefits of EPLI is payment for:

  • Attorney fees
  • Court costs
  • Settlements
  • Judgments

Even if the lawsuit is ultimately unsuccessful.  

What EPLI usually does NOT cover

Most EPLI policies exclude:

  • Workers’ compensation claims
  • Bodily injury or property damage
  • Intentional criminal acts
  • Fraud
  • Wage-and-hour violations (sometimes partially covered)
  • Professional malpractice
  • Unemployment claims

Coverage details vary by insurer.  

How much EPLI insurance costs in 2026

EPLI pricing depends heavily on:

  • Number of employees
  • Industry
  • State laws
  • Claims history
  • Employee turnover
  • Coverage limits
  • HR policies and training

Businesses in states like California and New York often pay more because employment laws are stricter.  

Typical EPLI costs in 2026

Business Type Typical Annual Cost
Very small business (1–10 employees) $800- $2,000
Small business (10–50 employees) $2,000 -$6,000
Mid-size company $5,000-$25,000
Large/high-risk employer $25,000+

Businesses most likely to buy EPLI

EPLI is especially common in industries with:

  • High employee turnover
  • Large staffs
  • Customer-facing employees

Examples:

  • Restaurants
  • Retail
  • Construction
  • Healthcare
  • Hospitality
  • Technology companies

Why EPLI matters in 2026

Employment-related lawsuits have become more common and expensive. Even defending a claim can cost tens of thousands of dollars. 

Disclaimer: All information provided is for informational purposes only and should not be construed as legal, financial, tax, or professional advice. Current costs, benefits, rates, and program details are based on information available at the time of publication and are subject to change without notice. Actual eligibility, pricing, incentives, and terms may vary and should be independently verified with the appropriate providers, agencies, or professionals before making any decisions or commitments.