When a former executive sued his company for defamation, the company turned to its umbrella liability insurance policy to cover the defense cost. But the insurer refused and a federal appeals court backed up the insurer.
Reason: The policy's use of the word "including." The court said three types of coverage situations (wrongful dismissal,or discrimination) following the word "including" were just examples of some, not all, types of employment-related practices not covered under the policy, and that defamation could be among them. (Moroni Feed Co. v. Mutual Service Casualty Insurance Co., No. 01-4008, 10th Cir., May 2002)
The lesson: One word makes a big difference. Scrutinize both general liability and employment practice liability insurance (EPLI) policies for vague or partial clauses explaining exclusions. Make sure you're getting the basics of standard EPLI coverage, the cost of defending and paying any settlements or awards in employment allegations that aren't included in your general liability coverage.
Like what you've read? ...Republish it and share great business tips!
Attention: Readers, Publishers, Editors, Bloggers, Media, Webmasters and more...
We believe great content should be read and passed around. After all, knowledge IS power. And good business can become great with the right information at their fingertips. If you'd like to share any of the insightful articles on BusinessManagementDaily.com, you may republish or syndicate it without charge.
The only thing we ask is that you keep the article exactly as it was written and formatted. You also need to include an attribution statement and link to the article.
" This information is proudly provided by Business Management Daily.com: http://www.businessmanagementdaily.com/705/check-the-fine-print-on-legal-liability-insurance "