Here’s What You Need to Know.
If you’re a homeowner with domestic employees, such as nannies, housekeepers, or personal assistants, you need to ask yourself, does home insurance cover domestic employees? Unfortunately, home insurance may not provide the coverage you need and many home owners aren’t aware of this. Understanding your liability and exploring Employment Practices Liability Insurance (EPLI) is essential to protecting yourself and your assets.
Why Home Insurance May Not Be Enough
Your homeowner’s insurance likely covers third-party claims, such as a visitor slipping on your property. However, what happens if a domestic employee files a lawsuit against you? As their employer, you could face significant legal exposure for claims related to employment practices. This is where EPLI comes into play.
Common Risks for Homeowners with Domestic Employees
Domestic workers can file lawsuits against you, just like any other employee. Even if you hired them through an agency, you may still be at risk depending on the agency’s insurance and the terms of the employment arrangement. Wealthy homeowners, in particular, may find themselves targeted due to their assets and public image, even if the claims are ultimately dismissed.
From an employer’s perspective, here are some common risks you might face:
- Discrimination: Claims related to race, gender, age, or other protected categories.
- Harassment: Allegations of workplace harassment.
- Wrongful Termination: Claims of being fired without proper cause.
- COVID-19 Issues: Allegations related to vaccine mandates, FFCRA violations, or unsafe working conditions.
The Costs of a Legal Defense
Even if the lawsuit is baseless, defending yourself in court can be expensive. Legal fees, court costs, and potential settlements or judgments can easily reach six or seven figures. EPLI helps offset these costs by covering:
- Legal defense expenses
- Settlements and judgments
- Allegations of wrongful discipline, breach of employment contract, or emotional distress
- Violations of the Family Medical Leave Act (FMLA) and mismanagement of benefits
How EPLI Protects You
Employment Practices Liability Insurance provides coverage for:
- Sexual harassment claims
- Discrimination allegations
- Wrongful termination lawsuits
- Emotional distress claims
- Other employment-related issues
Some insurance companies will appoint an experienced law firm to handle your defense, potentially negotiating settlements before the case goes to trial. However, if you prefer to use your attorney, let us know, and we’ll explore your options.
Additional Considerations
- Workers’ Compensation: EPLI does not cover workplace injuries. If a domestic worker is injured on the job, such as a nanny falling while chasing after your children, you’ll need a workers’ compensation policy.
- Vehicle Usage: If your domestic employees drive your vehicles, ensure your auto insurance provides adequate coverage.
Protect Your Assets with Confidence
At V.F. McNeil Insurance, we’re here to help you understand your risks and choose the right coverage. Contact us today at (203) 481-2684 or request an appointment online. We’ll guide you through the details of EPLI and other relevant policies to ensure you’re fully protected.
Don’t leave your liability to chance—protect your home, your employees, and your peace of mind with the right insurance coverage.
