Does Your Liability Insurance Protect You Against Immigration Enforcement?


By: Kelly Eisenlohr-Moul
Employers — do you assume that one of your insurance policies covers immigration enforcement actions — such as an investigation by the Department of Justice (DOJ), Immigration and Customs Enforcement (ICE), or U.S. Customs and Immigration Services (USCIS)?
If so, you may be in for an unpleasant surprise.
A federal district court recently ruled that a criminal immigration action against an employer, brought by ICE, was not covered by any of company’s liability policies: employment practices or D&O liability.  The court found that the policy language was not intended to encompass enforcement actions by the government.
This issue is important, as the Obama administration has increased immigration enforcement actions against employers, and will likely continue this trend.  Additionally, E-Verify usage makes slip-ups easier to monitor, and USCIS may “refer” an employer’s mistake to another agency for penalties or prosecution.
While this decision may isolated, it serves as an excellent reminder to check with your broker about what administrative actions or government investigations are covered by your liability insurance.
To paraphrase my favorite legal professor: “All I can tell you for certain about insurance is that you don’t have enough.”