03/16/2023
A claims-made insurance policy is a type of liability insurance policy that provides coverage for claims made against the insured during the policy period. This is in contrast to an occurrence-based policy, which provides coverage for incidents that occurred during the policy period, regardless of when the claim is made.
Under a claims-made policy, coverage is triggered when a claim is made against the insured during the policy period or during an extended reporting period, also known as a "tail" coverage. The tail coverage typically extends coverage for a period of time after the policy expires or is canceled, to ensure that claims can still be made for incidents that occurred while the policy was in effect.
One of the key features of a claims-made policy is that coverage is only available if the claim is reported during the policy period or the tail coverage period. This means that if a claim is made after the policy has expired and no tail coverage is in place, the claim may not be covered. As a result, it's important for policyholders to maintain continuous coverage under a claims-made policy to ensure that they are protected against claims that may arise in the future.
Claims-made policies are commonly used in professional liability insurance, including medical malpractice, legal malpractice, and other types of professional liability coverage. They are often preferred by insurers because they limit their exposure to claims that arise after the policy period, which can help to keep premiums lower for policyholders. However, they can be more complex than occurrence-based policies, and it's important for policyholders to understand the terms and limitations of their coverage to ensure that they are adequately protected.
Diederich Healthcare provides comprehensive medical malpractice insurance and consulting services to over 13,000 healthcare providers throughout the United States, Guam, and Puerto Rico. Through Diederich’s 13 U.S. regional offices and multiple sales and service centers, the company strives to provide superior client services. As a leader in the industry for almost 40 years, our goal is to deliver cost-effective quality insurance to our physician clients. For more information, or to obtain pricing please call 800-457-7790.
