Placement agencies face unique risk exposures that set them apart from many other types of businesses. In addition to providing coverage for permanent, in-house employees, firms must have a temporary staffing insurance policy that accommodates workers in a variety of roles with other firms. The four primary types of coverage needed include commercial general liability, errors and omissions, employee theft and crime and employment practices liability.
1. Commercial General Liability
Commercial general liability insurance provides for third-party injury and property damage claims and should extend to loss caused by a contract employee while working for a client.
2. Errors and Omissions
Professional liability, or errors and omissions, insurance protects against claims that arise in cases of professional negligence that cause financial harm to a client. Examples include failing to provide qualified workers or perform required background checks.
3. Employee Theft and Crime
Employee theft and crime insurance addresses instances of fraudulent and criminal acts carried out by an individual or group of employees. In addition to forgery, theft and alteration, a general policy might cover:
- credit card, money order or counterfeit fraud
- unauthorized electronic funds transfers
- computer fraud
4. Employment Practices Liability
EPLI coverage is designed to minimize risk of claims that prospective, current or former employees have used discriminatory employment practices, such as wrongful termination, failure to promote or sexual harassment.
In order to effectively minimize risk, each of these types of temporary staffing insurance should cover both internal employees and contract workers placed in various client work environments.