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What is Employee Benefits Liability Insurance?

what is employee insurance

Most charter schools offer some sort of health insurance to their employees.  And while those benefits help attract and retain qualified workers, errors in your plan’s administration can lead to lawsuits against your school.

For example, suppose your school hires a new teacher.   The new hire completes her necessary paperwork to be enrolled in the school’s health plan.   However, due to a clerical error by one of the human resource employees, the new teacher is not actually enrolled in the plan.   Some time later the teacher is hospitalized with a serious illness and discovers she doesn’t have any health insurance.  As the medical bills pile up, the teacher seeks restitution for the mistake and sues the school.    This type of claim is not covered by a general liability policy but rather an employee benefits liability policy.

Employee Benefits Liability


An employee benefits liability policy typically covers errors and omissions for the following:

  • Accurately describing plan benefits and eligibility rules.
  • Maintaining files

    and records related to employee benefits.

  • Enrolling, maintaining and terminating employees, eligible family members or beneficiaries in benefit plans.

Covered Benefits

What constitutes “employee benefits”? This term generally includes the following:

  • Insurance  Life, accident, dental and medical and other types of insurance
  • Plans  Pension, profit sharing, stock ownership and savings, and other plans
  • Benefits  Social security, workers compensation, disability and unemployment benefits
  • Other  Tuition assistance, maternity leave etc.

Policy Limits

Employee Benefits Liability coverage usually includes two separate limits. The Each Employee limit is the most the insurer will pay for any one employee, his or her family members and beneficiaries. The Aggregate limit is the most the insurer will pay for all acts, errors or omissions.


Employee benefits liability is a relatively inexpensive coverage to purchase.  Policies will start with an annual premium of $250 to $300 and increase as the number of employees at your school increases.

If you are interested in receiving a quote for your charter school, please contact our office.

Category: Insurance

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