1. Forms
2. EP
3. EP-20-01

What the form is

The EP 20 01 Additional Insured - Designated Person or Organization endorsement is a modification to an Employment-Related Practices Liability (ERPL) insurance policy. Its primary function is to extend the policy's coverage to include a person or organization that is not automatically covered as an insured under the standard policy language. By adding this endorsement, the designated person or organization gains insured status for claims alleging wrongful employment practices, subject to the terms, conditions, and exclusions of the underlying ERPL policy. This is a generic endorsement intended for use when no other, more specific additional insured endorsement is suitable.

Classes of business it applies to

This endorsement can be utilized by any type or size of business that carries an Employment-Related Practices Liability policy and has a need to extend that coverage to a third party. Examples include:

• A company that has a contractual obligation to provide EPLI coverage to a specific individual (e.g., a key contractor who is deeply involved in employment decisions but not an employee).
• An organization that needs to provide coverage for an affiliated entity that doesn't fall under the standard definition of an insured (e.g., a joint venture partner for liabilities arising specifically from the named insured's employment practices).
• Situations where a parent company wants to specifically name a subsidiary as an additional insured, although often specific endorsements for newly acquired or created organizations might be more appropriate if available.

Special considerations

• Specificity is Key: The designated person or organization must be clearly and accurately named in the endorsement. Ambiguity can lead to coverage disputes.
• Scope of Coverage: The coverage provided to the additional insured is typically limited to liability arising out of the named insured's employment practices. The additional insured is not covered for their own separate wrongful employment acts unless specifically stated or arising from the named insured's actions.
• Policy Limits: The addition of an insured party does not typically increase the policy's aggregate limits. All insureds, including those added by endorsement, will share the existing policy limits.
• Generic Nature: This endorsement is described as generic, meaning it should be considered when a more tailored additional insured endorsement (e.g., for controlling interests, volunteers, etc.) is not available or does not fit the specific circumstances.

Key information for agents and underwriters

• Agents: Agents should carefully assess the relationship between the named insured and the party to be added as an additional insured. It's crucial to understand why the additional insured status is required and to ensure this endorsement is the most appropriate means of providing the desired coverage. The agent should explain the scope and limitations of the coverage provided to the additional insured.
• Underwriters: Underwriters need to evaluate the potential increase in risk exposure resulting from adding another entity or person to the policy. They will consider the nature of the designated person's or organization's relationship to the named insured and the likelihood of them being named in employment-related lawsuits. The underwriting process may involve reviewing the additional insured's own employment practices if their operations are closely intertwined with the named insured. Pricing may be adjusted based on the perceived increase in risk.