EPLI has gone from virtual obscurity just ten years ago to being standard in many company’s insurance portfolios today. However, as a result of the significant claims settlements, premiums are on the rise. Additionally, carriers are increasing deductibles and tightening their underwriting requirements.

Although some small employers are concerned about the premium increases, they also should consider the valuable services that often accompany EPLI. In addition to insurance protection, some carriers offer an extensive array of loss control and risk management services — important since the leading cause of running afoul of the law is employer ignorance, rather than bad intentions.

It has long been recognized that directors and officers are the people who can make or break a company. However, after the collapse of companies such as Enron, Global Crossing and K-Mart, D&O underwriters are taking a closer look at board members. As a result, corporations should be prepared to provide additional information about their company directors.

The company’s charter and the workings of the audit committee also will be scrutinized, as will its insider trading policies. Underwriters are attempting to determine the independence of the audit committee, as well as possible conflicts of interest with board members. Underwriters probably will request documentation on these company policies.

Companies also should be prepared to begin their renewal process far earlier than in past years. What might have taken 30 days to complete in prior years could take 90 to 120 days now because of lengthy information requests. Plan for a time-consuming renewal process and let us assist you in this effort.