Risk & Business Magazine Knight Archer Insurance Spring 2016

R & Employment Practices Liability Insurance B Crucial for Small Businesses BY: KNIGHT ARCHER COMMERICAL INSURANCE A ccording to a recent study, more than half of all claims filed for employment-related liabilities are against employers with fewer than 50 employees. Alarmingly, the study also reveals that not even 2 per cent of small businesses have Employment Practices Liability (EPL) coverage. High Price Tag Employment-related claims can be extremely costly, especially in cases that drag on for years. With a slow economy and increasing adoption of workerfriendly laws, these cases are on the rise – in fact, discrimination claims are reaching their peak, with thousands of claims filed in 2010. These claims are often based on racial discrimination, gender, age and disabilities. Many small businesses cannot afford to pay these costs and keep their company afloat. What Puts Small Businesses at Risk? An Affordable Solution Understandably, it can be much more difficult for small businesses to defend themselves against employment-related claims because they tend to have fewer resources and a different work environment. Small businesses are particularly at risk for employment-related claims for the following reasons: Fortunately, with employment-based lawsuits on the rise and the economy’s sluggish upward climb, EPL coverage is becoming more affordable. More insurers are beginning to offer EPL insurance policies with comprehensive coverage to smaller businesses to protect them in tough times. In fact, EPL insurance is becoming so important to the success of small businesses that it is being offered at more affordable prices and being tailored specifically for those smaller companies. With the average cost of an employment lawsuit being thousands of dollars, the potential return dwarfs the initial cost of EPL coverage. Talk to Knight Archer Insurance Ltd. to learn if this risk transfer option is right for your business. • Many have a minimal staff and lack of in-house counsel and/or human resources to rely on • Overall lack of extensive recordkeeping on employee performance • More intimate working environments may cause personal problems during layoffs SPRING 2016 25 SPRING 2016 25

Risk & Business Magazine Knight Archer Insurance Spring 2016 | Page 25