A wrap policy is a policy that only covers punitive damages in the event of Employment Practices Liability (EPL) claims. Such forms are also referred to as offshore package policies because they “wrap” an eligible EPL (EPLI) insurance policy, providing coverage only for punitive damages resulting from a claim under the EPLI policy. Most commonly, the issuing insurer is a Bermudan affiliate of the EPLI insurer, but it can also be an unrelated insurer. While there has been some controversy regarding such a policy, its validity has yet to be tested in court.