Employer’s Liability


As a business owner, you likely work with one or more employees who are imperative to your business operations. You may be required to carry worker’s compensation insurance, which is an insurance coverage designed to offer benefits to workers who are injured or become sick on the job. In effect, this is an insurance program designed to provide disability benefits for workers, in exchange for that worker waiving their right to sue their employer.

Employer’s Liability insurance fills the gaps. If a worker is injured or falls sick on the job and does not feel their worker’s compensation benefits covers their loss, they may decide to sue regardless. Employers’ liability insurance comes into play here, designed to deal with any costs or expenses that fall outside the scope of workers’ compensation.

Get the best possible employer’s liability insurance with Hitchings Insurance. Whether your business is a factory, a farm, or even a healthcare facility, our team understands the depth of your work and how much it means to you. We’re family-owned, full-service, independent insurance agency based in Ohio that is dedicated to helping you. Request an employer’s liability insurance quote for free.

What is Employer’s Liability Insurance?

Employer’s liability insurance, in a sense, is like a fallback insurance program designed to cover all gaps left behind by workers’ compensation. Should a worker who was injured on the job or who fell sick while working for you feel that their loss is not adequately covered by workers’ compensation benefits, or that their employer’s negligence resulted in their injury or sickness, they may sue. Employer’s liability insurance protects the business from claims for additional damages and compensation extending beyond workers’ compensation insurance. The policies work hand-in-hand.

In essence, an employer’s liability insurance policy includes:

Third-Party Liability Lawsuits

If a workplace incident occurs, a lawsuit might be filed by an involved entity. As an example, if a worker is damaged by their equipment and sues the manufacturer, the manufacturer may then turn around and sue the employer.

Dual-Capacity Lawsuits

Should an employee sue their employer as both their employer and something else, i.e., a landlord, a product maker, or even the provider of a particular service, this would constitute as a dual-capacity lawsuit.

Loss of Consortium Lawsuits

If an employee dies or is disabled in a work-related incident, a loss of consortium lawsuit may be filed by the family members of the employee in an effort to seek compensation for the loss.

Consequential Bodily Injury Lawsuits

If a non-employee suffers physical damages (such as a spouse who suffers from health issues due to caring for the injured worker) from a work-related incident, that would constitute as a consequential bodily injury lawsuit.

Many companies will opt to carry employer’s liability insurance to aid in covering their business’ defense costs in court. Unfortunately, due to the nature of a particularly litigious society, claims can get extremely complicated – and incredibly costly – for employers, but especially in the case of a lawsuit. Even non-legitimate claims can cost businesses tens of thousands – even millions – and they cannot accept that level of risk.

Employer’s Liability Insurance vs Workers’ Compensation

These coverages go hand-in-hand and may be purchased together as an employers insurance package. Without either of these coverages, employers may be exposed to the full weight of both the legal and financial repercussions that can come out of a work-related death or severe injury.

This might result in your business having to front the cost of the following:

  • Awards and settlements
  • Legal costs
  • Administrative fees
  • Medical bills
  • Lost wages
  • …and more

Employer’s liability insurance is virtually an extension of workers’ compensation insurance and may cover your business’ legal costs if an employee or a non-employee who is a family member/spouse of that employee believes their benefits were not enough to compensate for their loss. They may also pursue their employer legally if they believed their illness or injury was due to the employer’s negligence. Workers’ compensation will no longer cover these costs; you’ll need employers’ liability insurance.

What Will Employer’s Liability Insurance Not Cover?

Like any commercial insurance policy, employer’s liability insurance has its limits. It does not cover every situation involving an employee or a work-related accident. Criminal acts, illegal profit or advantage, fraud, and intentional violation of the law will not be covered by your employer’s liability insurance. If claims arise out of layoffs, downsizing, workforce restructuring, mergers, or acquisitions, your employer’s liability insurance will not cover you also, but there is additional commercial coverage you can address with the help of a Hitchings Insurance agent which may cover certain circumstances.

If a claim was not covered because the injury or illness was intentional or aggravated, any claim made will be denied and the consequential costs will have to be paid out by the employer if the employee wins in court.

Some employer’s liability insurance policies will cover costs related to punitive damages through a “most-favored jurisdiction” clause, but some states will not allow insurers’ coverage to apply. Be sure to familiarize yourself with the wording of your policy.

Get an Employer’s Liability Insurance Quote

As a third-generation, family-owned, full-service insurance brokerage, we’re proud to serve our clients employer’s liability insurance that preserves their peace of mind. We are passionate about helping out our neighboring businesses, which we believe includes helping employers find the best employers liability insurance for the best price.

We understand that no two businesses are alike. What works for one business may not work for you. You have to consider different risks, different budgets. We work with a broad array of national and regional top-tier insurance companies to help you find the right options at the best value.

Start today with your employer’s liability insurance and get a free quote.