Going Separate Ways
In a lawsuit, you and an employee could be sent down different paths.
Opinions expressed by Entrepreneur contributors are their own.
Consider this scenario: One of your employees assaults acustomer, and that customer sues the employee, the company and you.But your liability coverage excludes intentional bad acts. Doesthis mean you are on the hook for legal fees and damages? Notnecessarily, says attorney Richard Zevnik, an associate with BergerKahn in Irvine, California.
Most business policies contain a "severability" or"separation of insureds" clause, which means that ifthere are multiple defendants in a lawsuit, the insurance companycould deny or limit coverage on one and not on others. So you andthe company could be covered for vicarious liability, but theemployee who committed the assault may be denied coverage.
Continue reading this article — and all of our other premium content with Entrepreneur+
For just $5, you can get unlimited access to all Entrepreneur’s premium content. You’ll find:
- Digestible insight on how to be a better entrepreneur and leader
- Lessons for starting and growing a business from our expert network of CEOs and founders
- Meaningful content to help you make sharper decisions
- Business and life hacks to help you stay ahead of the curve