Allegations of sexual misconduct against politicians, celebrities and other public figures have become increasingly common in recent years. In fact, social movements and a strong public outcry have led to a marked increase in sexual harassment claims—claims that can be incredibly damaging for organizations themselves.
As such, companies need to handle these situations with great care and be prepared with the proper insurance. Because no single insurance policy provides coverage for every type of claim that may result from misconduct allegations, policyholders should examine a variety of coverages to ensure they have protection when they need it most.
Here are the four types of Insurance to consider in these situations:
- Employment Practices Liability (EPL) Insurance
When it comes to protecting your organization against alleged sexual misconduct claims brought about by employees, EPL insurance is often the best source of coverage. Specifically, EPL insurance can provide protection for employment-related misconduct claims.
- General Liability Insurance
General liability policies are designed to protect businesses from claims related to bodily injury or property damage for which your business is found to be legally liable. In some situations, general liability policies can be used in sexual harassment claims. Specifically, general liability insurance can provide coverage for claims alleging personal injury and defamation, which is useful in some misconduct lawsuits.
- Directors and Officers (D&O) Insurance
Most directors and officers are surprised to learn that their own employees are one of the most common sources of D&O claims. In fact, if employees are mistreated during any phase of their employment, they may bring their concerns to the organization’s management team. If employees feel that their concerns have not been addressed in a satisfactory manner, they may seek legal action as a means of resolving their grievances.
- Crisis Management or Reputation Risk Insurance
Crisis management insurance and reputation risk insurance are two newer forms of coverage that can address the risks of negative publicity.