Ep. 491 The Crucial Role of Third-Party EPLI Coverage for Tree Care Companies
Rancho Mesa Partners Alyssa Burley and Rory Anderson talk about the critical role of third-party EPLI coverage specifically for the tree care industry.
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Director/Host: Alyssa Burley
Guest: Rory Anderson
Producer/Editor: Jadyn Brandt
Music: "Home" by JHS Pedals, “Breaking News Intro” by nem0production
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Transcript
Alyssa Burley: You’re listening to Rancho Mesa’s StudioOne™ podcast, where each week we break down complex insurance and safety topics to help your business thrive.
I’m your host, Alyssa Burley, and today I’m joined by Rory Anderson, Partner with Rancho Mesa. We’re going to talk about the role of third-party EPLI coverage for tree care companies.
Rory, welcome to the show.
Rory Anderson: Good morning Alyssa, thanks for having me here.
AB: Of course. Now, you specialize in the tree care industry and you know operating a tree care business comes with numerous risks, from ensuring the team’s safety on the job site to managing potential property damage.
But one crucial area of risk that is often overlooked is employment practices liability insurance, also known as EPLI. So, will you explain EPLI to our listeners.
RA: Yeah, certainly. So EPLI, Employment Practices Liability Insurance, is a coverage that is in place for sexual misconduct, discrimination, wrongful termination. So the wrongful termination would be first party, right? That's between the tree care company and the employee and so we see a lot of those claims come through where they're, again, feeling discriminated, wrongfully terminated things like that but then there's also a third-party aspect of EPLI that is very important to make sure that the policy has. And that would cover the third-party it could be your client it, could be the community, passersby, anybody else besides directly to your employee. And because tree care companies have such a high interaction with the public, it's extremely important to make sure that your EPL policy has the third party coverage built in.
AB: All right, so there may be business owners out there thinking my team would never harass anybody. So Can you give us some examples of some claims, some third party claims that you've seen?
RA: Yeah, absolutely. And again, this from the tree care company owner is an exposure that they have less control over because the first party, you can say, "Hey, we're going to take really good care of our guys, make sure that things are done by the book. We're going to pay them perfectly and we're not going to make mistakes."
Well, you have a certain sense of control for that. The third party exposure is one that you have much less control over. So, you know, a great example that I tend to give to my customers is if a lady is walking by with her dog and overhears something that the crew is talking about, oversees something that they're doing and she feels offended, she decides to sue the tree care company, that would be a third party lawsuit.
So again, harassment allegation from a homeowner or from a passerby. Also with how often arborists and tree care companies are working in trees or in bucket trucks from an elevated standpoint, there is that exposure of them accidentally looking into a window or into a backyard where maybe somebody is in a bathing suit, things like that, where you're going to have that type of exposure and they're going to decide to sue the tree care company saying that there was some type of inappropriate behavior displayed by the employee.
AB: Yeah. So why should business owners consider this type of coverage essential for their business?
RA: Yeah, well, again, I think it goes back to the high interaction that they have with the public. There's a lot of other trades where they're not necessarily so involved into the public. They might be at a job site where it's boarded off things like that. And so, and with their clients being homeowners, you know, within HOAs, apartment complexes. There's just a high interaction with the public, so you absolutely have that third party exposure.
AB: All right, so if a business owner decides, “Okay, we need to get third party coverage,” what should they be looking for in their EPLI policy?
RA: Yeah, so again, not every EPLI policy has third party coverage. A lot of them just cover that first party, so that's a key differentiator is to make sure that you have third party coverage. And then one other thing that we always look for is having the defense cost outside of your liability limit. So you have your million dollars of liability, but we know how expensive attorneys can be and defense costs can eat away at that million-dollar limit. And so we always recommend having a separate million-dollar limit for defense so that it's not corroding or eating away at the limit of liability.
AB: All right, so all of this is really great information. I think just hearing those examples, our listeners are going to strongly consider, you know, looking at third-party EPLI coverage. So Rory, if listeners have questions about EPLI insurance, what's the best way to get in touch with you?
RA: Give me a call (619) 486-6437 or you can just shoot me an email at randerson@ranchomesa.com
AB: All right, well, thank you for joining me in StudioOne™.
RA: Alyssa, thanks so much for having me.
AB: Thanks for tuning in to our latest episode produced by StudioOne™. If you enjoyed what you heard, please share this episode and subscribe. For more insights like this, visit us at RanchoMesa.com and subscribe to our weekly newsletter.