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⚠️ '''Employer's liability''' is a line of [[Definition:Insurance coverage | insurance coverage]] that protects employers against lawsuits brought by employees who suffer work-related injuries or illnesses outside the scope of the statutory [[Definition:Workers' compensation insurance | workers' compensation]] system. Part B of a standard workers' compensation and employer's liability policy, this coverage responds when an employee—or, in some cases, a spouse or dependent—alleges that the employer's [[Definition:Negligence | negligence]] directly caused harm, as opposed to claiming benefits through the no-fault workers' compensation framework.

🔄 In practice, employer's liability coverage is triggered by so-called "third-party-over" actions, [[Definition:Dual-capacity doctrine | dual-capacity claims]], and other legal theories that fall outside the [[Definition:Exclusive remedy | exclusive remedy]] protections workers' compensation provides to employers. For instance, if an employee sues the employer as a product manufacturer rather than simply as an employer, the claim may bypass workers' compensation entirely. [[Definition:Underwriter | Underwriters]] set employer's liability limits—commonly $100,000 per occurrence, $500,000 disease policy limit, and $100,000 disease per employee as statutory minimums, though many employers purchase higher limits. The coverage also dovetails with [[Definition:Umbrella insurance | umbrella]] and [[Definition:Excess liability insurance | excess liability]] policies, which may sit above the employer's liability layer.

🏛️ Overlooking adequate employer's liability limits can leave a business dangerously exposed. Workers' compensation [[Definition:Exclusive remedy | exclusive remedy]] protections are not airtight—courts in various jurisdictions have recognized exceptions that allow employees to pursue tort claims against their employers, sometimes resulting in substantial jury verdicts. [[Definition:Broker | Brokers]] and [[Definition:Risk manager | risk managers]] routinely review employer's liability limits during the [[Definition:Policy renewal | renewal]] process, especially for clients in high-hazard industries like construction, manufacturing, and energy. Carriers factor industry classification, [[Definition:Claims history | claims history]], and jurisdictional legal trends into their [[Definition:Pricing | pricing]], making this a coverage area where informed advisory work can meaningfully reduce a client's litigation risk.

'''Related concepts:'''
{{Div col|colwidth=20em}}
* [[Definition:Workers' compensation insurance]]
* [[Definition:Exclusive remedy]]
* [[Definition:Umbrella insurance]]
* [[Definition:Negligence]]
* [[Definition:Commercial general liability (CGL)]]
* [[Definition:Excess liability insurance]]
{{Div col end}}

Definition:Employer's liability - Revision history

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