Employers Liability Insurance: What is It?

Employers' liability insurance is an additional coverage a business owner may purchase to protect their assets against employees' injury claims as a cause of their employment. Employers' liability helps to pay legal fees associated with your defense costs against claims brought against you.

What is Covered

Employers' liability will cover the cost of an employee's medical expenses for injuries that were sustained as a result of a work related accident. Covered expenses include lost wages, disability coverage and payments of support to dependents. Employers' liability insurance will also pay for funeral expenses if the injured worker dies.

Some items are not covered under a employers' liability policy including sexual discrimination suits or wrongful termination of an employee.

Workers Compensation and Employers Liability Insurance

Employers' liability is part two of a standard workers' compensation policy, supplementing part 1 of the policy. Each state determines workers compensation benefits. An employee may choose to purchase any amount of coverage they feel necessary to protect their assets should a legal suit be brought against them.

Underwriting Criteria

When determining the premiums for employers' liability insurance, an underwriter may take many factors into consider such as the size of the business, what the hazards of the operations are, payroll size and how many employees work for the company. Different class codes can be assigned to work duties depending upon the work involved and may ultimately affect the price of coverage. The more dangerous the work, the higher the premium charged.

Benefits

Employers' liability coverage is important employees and employers, providing important protection for both should the unthinkable happen. An employer cannot afford to be left unprotected in such cases. Business owners should check with their state's department of insurance to make sure they are in compliance with the law. Worker's compensation and employers' liability insurance are mandatory coverages in many states.

To make the most cost-efficient decision possible, business owners should shop around and Compare Employers Liability Insurance Rates.

Sources:

Employers' Liability and Workers' Compensation

Business Insurance for Small Business - Business Liability Insurance Coverage - General Liability, Property, Workers' Compensation, BOP