Liability policies use one of two triggers to decide which policy year responds to a claim.
Occurrence policies cover bodily injury or property damage that happens during the policy period, no matter when the claim is filed. A slip-and-fall in 2025 is covered by the 2025 policy even if the lawsuit arrives in 2028. Most general liability, auto and BOP liability is written this way.
Claims-made policies cover claims first made against the insured during the policy period, for incidents after the policy’s retroactive date. Professional liability, directors and officers, employment practices and cyber are usually claims-made. Many E&S general liability forms are too.
How it shows up in an agency
An accounting firm switches professional liability carriers. If the new policy’s retroactive date is today, any claim about work done last year has no coverage: the old policy ended and the new one excludes prior acts. The account manager asks the new carrier to match the prior retro date (“full prior acts”). If the firm closes or switches to a carrier that won’t match, it needs an extended reporting period (“tail”) from the expiring carrier, which gives more time to report claims for past work.
See carriers on our professional liability and cyber pages.
Common confusion
- The retro date is the key field. Two claims-made quotes with different retro dates aren’t comparable. Check it on every renewal and remarketing.
- Reporting requirements. Claims-made policies often require the claim to be reported during the policy period or a short window after. Late reporting can void coverage.
- “Claims-made and reported” is stricter than plain claims-made: both the claim and the report must fall inside the period.
- Occurrence isn’t automatically better. Claims-made pricing starts lower and steps up over the first few years. What matters is continuity of the retro date.