Employee Benefits Liability Insurance

Businesses today understand the importance of offering benefits to employees. Not only does it entice top talent to the business, but offering a solid benefits program helps to create loyal and engaged employees. That being said, offering benefits also exposes to the businesses to a few potential risks worth understanding. Those risks include liability claims and lawsuits related to errors in the administration of these benefits.

Mistakes happen. At Otterstedt Insurance Agency we don’t believe your business should be subject to the substantial financial ramifications of lawsuits because of an honest mistake in administering benefits programs. We offer a full line of products to help protect businesses from the financial devastation that can occur as a result of a single mistake.

What Types of Mistakes are Covered by EBL Insurance?

It’s important to understand that specific coverages will vary somewhat from provider to provider. Employee benefits liability insurance typically covers the following situations, however.

  • Failure to enroll a new employee or their eligible family members in the employee health plan.
  • Mistakenly provides false information regarding eligibility for health plan.
  • Failure to enroll employee in company sponsored life insurance plan.
  • Enrolling employee in the wrong medical, dental, or life insurance plan.
  • Accidentally deleting employee’s benefit records.
  • Terminating an employee’s (or eligible family member’s) benefit plans.
  • Updating medical, life, or dental insurance information inaccurately (such as deleting a beneficiary or identifying the wrong beneficiary).

As you can see, it’s easy, and certainly human, to make errors when working with employee benefits. Those mistakes, however, can prove costly. Employee benefits liability coverage helps to mitigate the costs of damages and legal fees related to these claims in order to protect the business and the responsible personnel.

Is Employee Benefits Liability the same as Fiduciary Liability?

Employee benefits liability is limited to the scope of coverage outlined above. Primarily it’s related to administrative errors and omissions. It does not extend to fiduciary liability or employment practices liability, both of which are covered by different types of insurance policies offered by Otterstedt Insurance Agency. The cost of failing to get the right policy to cover your liability needs may be more than your business can stand.

Limits and Exclusions Related to Employee Benefits Liability Insurance

There are two main limits for the average employee benefits liability policy. The first limit is for the amount the insurer will pay for one specific employee. The second related to the aggregate limit insurers will pay for all employee benefits errors and omissions. Most policies have a deductible for each employee who files a claim.

Claims related to poor financial advice or false performance predictions are specifically excluded as are acts of fraud, breach of contract, property damage, bodily injury, employment practices, and insufficient funds to pay benefits.

Working with an independent insurance agency like Otterstedt means that you can have the differences in coverage, policies, exclusions, etc. explained to you by caring professionals who want to make sure you get the coverage your business needs without a lot of excess baggage coverages.

Work with Otterstedt Insurance Agency for Your Employee Benefits Liability Insurance

Whether you need employee benefits liability insurance or have no idea what kinds of liability coverage your business needs, it pays to work with an industry leader who has been serving New Jersey businesses since 1919.

Otterstedt Insurance Agency still clings to the principles of commitment to the community and the people within it. This is the same principle that has served us well for nearly a century and will continue to do so well into our next century of doing business.

Call us today at 201-227-1800 for a free rate quote and to discuss how we can help you with your employee benefits liability coverage and claims today.

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