NOLASKO INSURANCE ADVISORS
Insurance Decoded
Coverage Education Series
Carlos Nolasco
(832) 592-1114
Workers’ Comp, Employers’ Liability & EPLI
Three coverage lines that sound similar — but protect against very different risks
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Workers’ Compensation
Part A of the WC Policy · Statutory Coverage
A statutory benefit system that pays an injured employee’s medical bills and lost wages regardless of fault — no lawsuit required. Mandated by most states.
The Employee — pays medical expenses, lost income, and disability benefits directly.
Work-related injury or illness. Fault is irrelevant.
Employee waives right to sue in exchange for guaranteed benefits — the “exclusive remedy” doctrine.
Yes — Most States Texas is the primary exception.
No
Occurrence
Example: A warehouse worker falls off a ladder and breaks his arm. WC pays his medical bills and a portion of his wages while he recovers — automatically, no lawsuit needed.
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Employers’ Liability (EL)
Part B of the WC Policy · Always Travels with Workers’ Comp
Protects the employer when an injured employee finds a way around the exclusive remedy doctrine and files a civil suit against the company.
The Employer — pays legal defense costs and damages when sued by an employee over a work-related injury.
Work-related bodily injury where the employee has a viable civil claim that bypasses exclusive remedy.
Third-party over actions · Loss of consortium · Dual capacity claims · Texas non-subscriber situations
$100K/$500K/$100K standard — most contracts require $1,000,000.
Yes Always stems from a bodily injury event.
Occurrence
Example: A worker is injured by equipment his employer also manufactured. WC exclusive remedy blocks a direct negligence suit — but he can sue the employer as the equipment manufacturer. Employers’ Liability responds to that lawsuit.
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Employment Practices Liability (EPLI)
Separate Policy · Claims-Made · No Physical Injury Required
A completely separate policy covering the employer against claims by employees or applicants alleging wrongful employment acts — has nothing to do with physical injury.
The Employer — against claims that the employer violated someone’s employment rights.
Discrimination · Harassment · Wrongful termination · Retaliation · Failure to hire/promote · Hostile work environment · Wage & hour violations
No Purely employment rights — no bodily injury required.
No Voluntary — but highly recommended.
Claims-Made — claim must be made during the policy period.
$100K – $1M+, depending on company size and exposure.
Example: A former employee claims she was fired because she was pregnant. She files an EEOC charge and then a civil lawsuit. EPLI responds — paying defense costs and any settlement or judgment.
Side-by-Side Comparison
| Element | Workers’ Compensation | Employers’ Liability | Employment Practices Liability |
|---|---|---|---|
| Part of WC Policy? | Yes — Part A | Yes — Part B | No — separate policy entirely |
| Protects | Employee | Employer | Employer |
| Covers | Medical bills, lost wages, disability | Civil suits by injured workers bypassing exclusive remedy | Wrongful employment act claims |
| Trigger | Work injury or illness | Work injury + civil claim workaround | Discrimination, harassment, wrongful termination, retaliation, etc. |
| Physical Injury? | Yes | Yes | No |
| Fault Required? | No | Yes | Yes (alleged) |
| Policy Type | Occurrence | Occurrence | Claims-Made |
| Typical Limits | Statutory (unlimited Part A) | $100K–$1M (contracts often require $1M) | $100K–$1M+ |
| Required by Law? | Yes — most states | Comes with WC policy | No — voluntary |
💡 The Simple Way to Remember It
WC
Employee gets hurt → WC pays the employee directly. No lawsuit needed. Fast, automatic, no-fault.
EL
Employee gets hurt → finds a way to sue the employer anyway → Employers’ Liability defends the employer against that lawsuit.
EPLI
Employee claims their rights were violated (fired unfairly, harassed, discriminated against) → EPLI defends the employer. No physical injury involved.
Questions about workers’ comp, employers’ liability, or EPLI for your business?
Talk to Carlos →