I was published in the D&O Diary!!!
Here I outline the article and provide a link for your viewing pleasure
0 employees....but no coverage without EPLI!!!!
Really appreciate Kevin LaCroix and Sarah Abrams publishing my latest article in The D&O Diary.
This was a really interesting case where a local chamber of commerce HAD a D&O policy, but since they didn’t also purchase EPLI they had no coverage whatsoever for the discrimination lawsuit they were faced with.
Parkland Chamber of Commerce was sued for civil rights violations after allegedly pressuring a hotel to cancel a regional Muslim organization’s conference.
They had a D&O policy, but the discrimination exclusion was written in absolute “arising out of” language.
The insured tried two arguments to get coverage: --> The Conduct Exclusion created ambiguity → court said that would be a “windfall for intentional discriminators” --> Tortious interference allegations were separately covered → court said “arising out of” discrimination pulls every claim back under the exclusion
Mount Vernon’s denial was upheld. The Chamber defended itself for 14+ months with zero carrier backing.
Plot twist: the Chamber ultimately won the underlying suit... but still ate every dollar of defense costs alone.
“Once an absolute exclusion is triggered, all bets are off.”
The fix was simple: EPLI alongside the D&O. Third-party discrimination/harassment coverage would have responded where the D&O could not.
Insurance professionals — have you ever upsold EPLI to your nonprofits with zero employees? Seems unintuitive... why would I purchase Employment Practices Liability when I don’t have ANY employees? But as this insured learned the hard way, zero-employee organizations still have third-party harassment/discrimination exposures that a monoline D&O policy most likely excludes. Third-party EPLI can be a real lifesaver...if you invest in the coverage.
Read the full analysis here:
The information shared in this post is for educational purposes only and does not constitute legal or insurance coverage advice. Always consult with a qualified insurance professional regarding your specific coverage needs.