When Your Industry Is Too Toxic To Be Insured Against Sexual Harassment Claims

There’s a fascinating story in The Intercept about EPLI - the insurance coverage that businesses take out in case of employment lawsuits. According to this piece, nearly a third of insurance companies polled won't underwrite the legal industry. A quarter won't underwrite financial firms. Nearly as many won’t cover the entertainment industry. When that’s happening, it's a good time to look at organizational culture and what prevents harassment and discrimination in the first place.

When setting premiums (or deciding whether not to cover at all), underwriters look for details about what structures businesses have in place to address complaints of harassment and discrimination, and some go further. “One insurer wanted a list of all incidents, including ones that have not triggered a formal complaint, with the name of the claimant, the allegations made, the settlement amount any complainant received, and what remedial actions were taken.” Unlike other features of the financial industry, harassment may be a situation where past performance is an indicator of future results. At least it sounds like that’s what the insurance companies think.