HSB and Munich Re America Introduce New Joint Employment Practices Liability Product
Combines Broader EPL Coverage with Better Services to Prevent Claims
October 21 2009 - HARTFORD, Conn.-The Hartford Steam Boiler Inspection and Insurance Company
(HSB) and Munich Reinsurance America, Inc., today announced a new, jointly developed Employment Practices Liability
(EPL) insurance program that makes broader EPL coverage and additional risk management services available to small
businesses at affordable premiums.
The new EPL insurance program from HSB and Munich Re America is designed specifically for businesses
with 50 or fewer employees and includes advanced EPL coverages that until recently were available only to large
employers. These include coverage for prior acts that occur before the policy's inception date, punitive damages
coverage, a broadened definition of employees to include independent contractors and optional third-party coverage
for discrimination and harassment claims made by business customers or vendors.
"The danger to small businesses of employment-related charges and claims continues to grow,"
said Jeffrey O'Shaughnessy, vice president of HSB. "Combine the current business climate that has forced many
employers to trim their staff with evolving employment laws and an aging and more diverse workforce, and the trend
is more risk for employers."
A legal helpline is included to help business owners avoid employment practices claims and obtain
general employment guidance. This service gives business owners access to best practices advice about a broad range
of subjects including factors to consider when making specific employment decisions.
"More than 50 percent of EPL charges are brought against smaller firms, yet only 1.2 percent of small
businesses purchase EPL insurance protection," said David Richardson, vice president, Munich Re America. "By combining
the best of HSB's and Munich Re America's EPL products we can offer broader coverages, better risk management and full
claim services at premiums that small businesses can afford."
The program also includes a loss prevention website that provides ready-made employment policies and
procedures to help employers prevent claims and more effectively defend themselves in the event of a charge.
Workplace discrimination charges filed in 2008 with the U.S. Equal Employment Opportunity Commission
(EEOC) soared 15 percent over the previous year to 95,402, the agency reports, with $376 million awarded to workers.
According to HSB's analysis of EEOC data, 81 percent of all employment charges settle for between an average of
$22,400 and $40,500. Even if claims are found to be groundless, they still require significant legal expenses to
defend against.
The joint EPL insurance product is a turnkey reinsurance program with limits available from $25,000
to $1,000,000. Coverage is endorsed to commercial policies of insurance companies that partner with either HSB or
Munich Re America. The program is reinsured, implemented, and administered by HSB. A separate underwriting process
is not required and it is simple and inexpensive to administer because HSB fully supports product implementation.
Hartford Steam Boiler provides a range of specialty insurance coverages for business, home and farm.
One of the world's leading equipment breakdown insurers, HSB helps clients reduce risk through a unique combination of
specialty coverages, engineering-based risk management strategies and loss reduction services. HSB was purchased by
Munich Re in April 2009. For more information about HSB visit its Web site at www.hsb.com.
Munich Re America, a member of the Munich Re Group, offers superior capacity to meet clients' risk-transfer
needs, and a full range of property and casualty coverages through multiple distribution channels. Its three business
platforms include: the property-casualty reinsurance division, Munich America Reinsurance, which provides treaty and
facultative reinsurance products and services on both a broker and direct basis; affiliate Hartford Steam Boiler, a
global specialty insurer and reinsurer offering a range of specialty coverages, engineering-based risk management,
and loss reduction services; and the Munich America Specialty Insurance division, which includes specialty
personal lines insurance group American Modern Insurance Group and the Specialty Markets division, a provider of
risk solutions to nontraditional insurance entities. More about Munich Re America products and services can be found
at www.munichreamerica.com.
This is a summary of coverages. For all coverages, terms, conditions and exclusions refer to the actual insurance policy. Coverage may not be available in all states.
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