One of the fastest growing areas of litigation is in employment practices. Cases involving sexual harassment, or discrimination based on sex, race, age, disability, religious or ethnic background, and appearance, are being filed at ever-increasing rates. Most employers have, or if they don’t, should have, employment practices liability (“EPL”) coverage to protect them against these suits. However, insurers are increasingly limiting the coverage and resisting payment of EPL claims. Reed Smith’s Insurance Recovery Team understands the challenges facing policyholders in the current legal climate. We are a full-service law firm, dedicated to working with our clients through all phases of the insurance process, from securing the best policy terms, to the submission and favorable resolution of claims.
Reed Smith’s Insurance Recovery attorneys work with clients and their brokers to review and analyze existing general liability, D&O, and E&O policies to determine if EPL coverage is available. We also work with clients and their brokers to analyze stand-alone EPL policies. During the policy renewal process, our attorneys review potential coverages to determine which policy best meets the needs of each insured. At the client’s option, we participate in negotiations with insurers, either directly or through the client, to obtain the most comprehensive coverage available. We represent all types of businesses, including Fortune 100 corporations, small, privately held companies, universities and colleges, and school districts.
One of the key issues in EPL coverage arises out of its claims-made nature. More and more carriers seek to deny EPL coverage in cases where reporting requirements have not been satisfied. Reed Smith Insurance Recovery attorneys know all of the ins-and-outs of claims-made coverages, and can assist clients in developing proper procedures for identifying and reporting claims. We also understand the best arguments to make in the event the carrier takes a position that the claim was not timely reported.
In the event of a claim, Reed Smith’s Insurance Recovery Team assists the client in analyzing coverage potentially available under all the different policies and giving notice to the appropriate carriers. If, the carrier reserves rights or denies coverage, we aggressively negotiate to secure coverage for the claim. Negotiation (including the use of alternative dispute mechanisms, such as mediation) can often resolve insurance coverage disputes, including reversals of outright coverage denials, without the need to incur litigation costs. If litigation becomes necessary, our attorneys advocate in state and federal court, and in arbitration, to obtain the best possible results for our clients.
Examples of our experience include:
- Reed Smith persuaded an insurer to withdraw denial based on failure to timely report a claim, by demonstrating that the factual basis for denial was flawed. After only one detailed demand letter, the carrier withdrew the denial and agreed to undertake the defense of an EPL claim. The carrier later agreed to pay indemnity for the claim.
- Reed Smith attorneys are assisting a relatively small, privately held business with numerous interests in evaluating its EPL exposure and determining the best structure for the coverage, given the complex structure of the various unrelated businesses falling under the same ownership umbrella.
- Reed Smith attorneys are assisting a large multi-national corporation in accessing EPL coverage relating to multiple civil rights claims brought against it by former employees, in which the carrier seeks to avoid coverage by asserting that the client did not comply with the notice provisions of the applicable policies.
- Reed Smith attorneys reviewed and identified holes in the EPL coverage carried by a school district, and provided advice to the client in conjunction with its negotiation of replacement coverage.