Small companies often depend on a Professional Employer Organization (PEO) to operate as an adjunct human resource department. Within this role, some PEOs closely resemble a traditional staffing agency while others administer important employee services such as payroll/tax operations, retirement benefits, training and workers compensation.
Typically, a company enters into a co-employment contract with the PEO. In such instances the PEO becomes the employer of record, in which case it fully exposes itself to a litany of potential liability issues. It is this dynamic that makes it essential for an organization to be covered by a comprehensive package of PEO insurance.
Cover All the Bases
It goes without saying that a PEO needs a business policy or commercial package policy that includes general liability, property and professional liability. Because the role a PEO plays is often unique, it is important to deal with an agent or broker who specializes in writing PEO insurance.
Depending on the PEO, insurance likely will be needed for many additional areas of risk exposure. Workers compensation, depending on the terms of the contract with your client, is a key area of coverage that may be your sole or partial responsibility. After determining your company’s specific needs, an agent also may recommend that you add policies in some or all of the following areas:
- Business auto
- Hired and non-owned auto
- Employment practices liability
- Employee benefits liability
- Directors and officers
- Cyber liability
- Business income interruption
Don’t risk the financial security of your organization. Contact an experienced agent to learn more about PEO insurance.