Damages: the typical EPL definition includes pre- and post-judgment interest and punitive, exemplary, liquidated and multiplied damages, up to the limit of liability and where insurable. Most favorable jurisdiction language looks to the law most favorable to insurability. Liquidated damages can arise under federal law, such as for willful violations of the Age Discrimination in Employment Act (29 USC §626(b)). None of this adds to the limit.

California limit on punitive damages: the California Supreme Court has said public policy prohibits indemnification for punitive damages, citing Insurance Code §533 (PPG Industries v. Transamerica, 1999). Punitive damages exist to punish the defendant (Civil Code §3294(a)), and shifting them to an insurer would defeat that purpose. So where California law governs, an employer bears a punitive award for its own malicious conduct, even if the policy says "where insurable."

Wrongful acts are defined broadly and include, but are not limited to, discrimination, harassment, wrongful demotion, failure to hire or promote, a hostile or offensive work environment that interferes with work performance, termination and retaliation. A forklift injury at work is a workers' compensation matter, not an employment practices claim.

Even small California employers have this exposure. For harassment, the Fair Employment and Housing Act (FEHA) defines employer as any person regularly employing one or more persons (Government Code §12940(j)(4)(A)). The five-employee threshold in §12926(d) applies to the rest of §12940, and the 15-employee figure comes from federal Title VII.

Bodily injury exclusion: EPL excludes physical injury, but carves out emotional distress, mental anguish, defamation, invasion of privacy and humiliation. Those are the usual damages in an employment claim, so they stay covered.

Intentional acts: EPL forms typically have no exclusion for fraudulent or intentional acts of the employer or its agents, because many discrimination claims allege intentional conduct. California still limits indemnity: under Insurance Code §533, an insurer is not liable for a loss caused by the wilful act of the insured, though it is not exonerated by negligence.