As an employer who offers benefits to your workforce, you have an obligation to provide the benefits that you promised, at the cost you indicated, for the period of time that you said the benefits would be available. Failure to comply with this “contract” can get you in trouble, even resulting in lawsuits or other employee liability if someone decided to sue your organization.
You probably provide benefits to your employees because it’s a great way to attract and retain top talent. In today’s marketplace, benefits are often second only to salary in terms of something employees value in their workplace. However, when you fail to properly administer those benefits, you misrepresent the benefits to your employees, or you omit information that employees need, you could be liable for damages that result. Without proper employee liability coverage, your company could quickly be bankrupted by legal fees and judgments that rule in favor of an employee who sues.
Partnering With the Insurance Company
Unless you are a huge multi-billion dollar company that does your own insurance underwriting, chances are you partner with an insurance provider to give your employees benefits such as medical, dental, and vision insurance, long- and short-term disability, and life insurance policies. The insurance company will likely assist you by providing information about the policy, and helping employees fill out forms. If there are omissions or errors in that process, your company will often be held liable right along with the insurance company in a lawsuit.
To protect your company from damages and loss due to negligence, omissions, or errors in administering your benefits plan to employees, it’s critical that you have proper employee liability coverage.