Sometimes, your worker’s compensation and general liability policies don’t go far enough to make sure you’re robustly protected from the costs associated with accidents involving your employees. Depending on the state you operate in, your needs are likely related to limitations on the coverage for employer liability in those policies. Rather than having to take out an entirely new employer liability plan that would largely provide overlapping coverage, there’s the option of stop gap insurance. Most companies operating in monopolistic workers’ compensation states will find these policies unnecessary, but they’re a staple in non-monopolistic states like North Dakota.
Stop Gap Coverage for Staffing Companies
Stopgap liability in the staffing industry is another matter. Companies whose business model is based on recruiting contract, temporary or full-time staff for client businesses incur risks and open themselves to liabilities that are unique to the business model. As a result, robust risk management planning for those businesses usually involves some kind of additional stop gap coverage. There are a lot of good reasons for doing this, but the most basic one is also one of the most compelling. Simply put, when you have a lot of employees operating in a variety of environments you don’t directly control, you have an elevated risk of hitting any policy maximums you have for employer liability. Purchasing more extensive and expensive coverage for a likelihood that is remote but foreseeable can be expensive, but stop-gap coverage offers a cost-efficient way to reach that goal.