What Type of Insurance Do Human Resources (HR) Professionals Need?

Human resources (HR) professionals provide vital services to any organization. Their responsibilities go beyond just recruiting job applicants to fill a company’s open positions – a critical function in itself. They also contribute significantly to the growth of the organization in various ways, making them an integral part of the company’s success.

The diverse responsibilities of HR professionals, from managing relationships between employees and a company’s leadership to providing training and development support and administering payroll and employee benefits to tracking employee performance and ensuring an employer complies with labour laws and regulations, contribute to a company’s growth. However, those responsibilities also open the door to potential liability risks.

According to the Human Resources Professionals Association  (HRPA), full-time HR professionals and independent HR practitioners working on a contract or volunteer basis and who are HRPA members must carry liability insurance. Regardless, it’s wise for any HR practitioner to have a customized HR insurance policy.

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4 Essential Types of Insurance for HR Professionals

Creating a customized liability insurance policy for your HR practice involves several types of coverage. Whether you need all or only a few depends on your services, location, experience, and other factors insurers consider when determining the annual premium. Here are four types of insurance many HR professionals require:

1. Professional Liability Insurance

Also known as errors and omissions (E&O) insurance, professional liability insurance is designed to cover claims made against an HR practitioner for losses suffered by a third party because of failure to meet the expected performance standards. This coverage also provides funds for your legal defence against claims and allegations, even if they are proven to be groundless. 

2. General Liability Insurance

General liability insurance covers expenses related to third-party bodily injuries and property damage caused by your actions or regular operations, whether at your business premises or elsewhere. It also includes protection for allegations of defamation (libel or slander).  

3. Commercial Property Insurance

If you own an HR practice and have a dedicated office space, it’s vital to protect the property and your business contents from damages and losses caused by fire, water, theft, vandalism, and natural disasters. That’s what commercial property insurance covers. 

4. Cyber Liability Insurance

HR practitioners are trusted to handle confidential information about employees, job applicants, and other sensitive company data. Given HR teams and consultants’ increasing reliance on technology platforms and digital record-keeping, cyber liability insurance is essential to cover damages resulting from a data breach or cyber-attack.

Additional Coverages for HR Professionals

Depending on the nature of your employment and services, additional coverages may be needed to build a comprehensive liability insurance policy. These may include the following:

Employment Practices Liability Insurance

Employment practices liability insurance is intended to cover HR pros from claims and allegations of wrongful termination, discrimination, harassment, retaliation, and other related issues. This type of coverage is more commonly included in policies for in-house HR managers responsible for managing employee relations.

Directors and Officers (D&O) Insurance

For HR professionals serving in leadership positions as part of a company’s board of directors or senior management, D&O insurance is valuable to include. It’s designed to shield HR executives and senior leaders from legal expenses if they are sued for decisions that affect an organization’s operations, employees, or compliance-related activities.

Speak to a licensed Zensurance broker if you have questions about what your policy should contain.

How to Get Low-Cost HR Liability Insurance Quickly

Zensurance is Canada’s leading business liability insurance provider, trusted by hundreds of thousands of Canadian small business owners and independent professionals across industries. 

We specialize in offering customized, reliable, low-cost liability insurance, including HR insurance.

Fill out our online application for a free quote in just a few minutes. Once you’ve received your quote, you can easily purchase your insurance policy online or discuss your options with one of our brokers.

Let our knowledgeable team of brokers shop your rate to over 50 insurers in our partner network and tailor the coverage you need at a price you can afford.