Sexual Harassment Insurance For Small Businesses

All it takes is one single lawsuit from a sexual harassment claim for a business to have its tables unturned and business halted. A sexual harassment claim can cost a business a lot of money, not to mention cost them their reputation. Many small businesses have a sexual harassment policy listed in black and white in their employee handbook, but many do not have sexual harassment insurance as part of their business insurance.


Just in 2008 alone, the U.S. Equal Employment Opportunity Commission (EEOC) received over 13,000 sexual harassment charges, with over 15% of them being filed by males. In terms of dollars, the EEOC recovered roughly $47.4 million in monies for the charged parties in that year.


Sexual harassment is explained as an activity that violates another person sexually. Behavior such as this, whether physical or verbal, violates Title VII of the Civil Rights Act of 1964. Even though most sexual harassment claims are made by women, the laws prohibiting sexual harassment pertain to both men and women as both victims and harassers of sexual harassment. Even bullying, coercion and intimidation of a sexual nature can be constituted as sexual harassment. The EEOC describes sexual harassment to include requests for sexual favors, unwelcome sexual advances or physical or verbal conduct of a sexual nature.


Experts suggest that the reporting of sexual harassment incidents are increasing as the awareness of sexual harassment has likewise increased. Although companies should do everything they need to do to teach their employees about what constitutes sexual harassment, the small business owner must also protect himself financially. He can do this by making sure he is covered by a sexual harassment insurance policy which is part of Employment Practices Liability Insurance.


When a small business owner is confronted with a sexual harassment claim, he may not have the infrastructure in place to handle such complaint when one happens. Although not all sexual harassment incidents are severe enough for a legal claims, many claims do have a solid legal case.


Most sexual harassment insurance policies cover such costs as defense costs and court fees. In other cases, many sexual harassment claims are settled outside of court, but with a hefty price tag. With rising legal expenses and increased employee-driven sexual harassment lawsuits, it’s important for the small business to consider Employment Practices Liability Insurance as part of their portfolio of business insurance.