Lambert & Associates Insurance Brokerage

Welcome To Our Frequently Asked Questions

What is the difference between Claims-Made and Occurence Coverage?

While Occurence Coverage is based on when the act occured, Claims-Made is based on when the act is reported (when the claim is actually made).

Claims-Made Policies provide coverage for claims which are reported to the insurer while the policy is in force. The policy covers professional services rendered on or after (1) the policy inception date or (2) an earlier retroactive date. Thus, a Claims-Made policy may provide coverage for professional services rendered from a retroactive date through cancellation or expiration of the current policy, so long as the claim is reported to the insurer during the policy period.

Claims-Made Coverage is less expensive than Occurence Coverage during the first few years. Each year as the policy is renewed, the price increases to compensate for the increased risk of receiving claims from previous years. Premium increases, often called "steps", reflect the insured's increased exposure to liability. Steps usually cease after five (5) years have transpired from the retroactive date, this is called a "mature premium".

What is a Retroactive Date?

The retroactive date is a date mutually agreed upon by the company and the insured.

What is "TAIL"?

Due to cancellation or non-renewal, an additional premium to purchase an Extended Reporting Endorsement, commonly called "tail coverage" may be required to provide protection for claims reported after the final Claims-Made policy's termination date.