How does an occurrence policy work?
Asked by: Dr. Darwin Kerluke | Last update: June 26, 2025Score: 4.6/5 (45 votes)
Which is better, claims made or occurrence policy?
In short, occurrence-based policies provide ample coverage as long as you keep renewing them. For this privilege, you'll generally pay more than you would for claims-made policies. With claims-made policies, the amount of coverage you purchase must last for as long as you keep your policy.
What does occurrence mean in an insurance policy?
An occurrence policy covers claims made for injuries sustained during the life of an insurance policy, even if they're filed after the policy is canceled. They cater specifically to events that may cause injury of damage years after they occur, such as exposure to hazardous chemicals.
What is the difference between accident and occurrence in insurance?
The term "occurrence" encompasses more than just an accident because accident is narrower in scope than occurrence. This can be seen in those cases decided before the occurrence wording was adopted. Accident, according to these cases, did not include coverage for damage occurring over time.
What is the trigger for occurrence coverage?
Under an occurrence trigger, the policy responds to claims based on when the alleged incident took place, regardless of when the claim is reported or when the lawsuit is filed.
Claims-Made vs. Occurrence Coverage EXPLAINED IN FIVE MINUTES!
How does an occurrence based policy work?
Occurrence-based insurance is a type of policy that pays for losses that occur during the policy period, even if it's no longer active when you file a claim.
What is the amount of coverage per occurrence?
Per occurrence limit is the maximum amount the insurer will pay for all claims resulting from a single occurrence, no matter how many people are injured, how much property is damaged, or how many different claimants may make claims.
What counts as an occurrence?
An occurrence is an unscheduled absence or late arrival (Not protected by FMLA, WC, etc.). For example, arriving 30 minutes late would count as an occurrence and calling in to use sick leave, vacation, or comp time for a day would be an occurrence.
What is a claims occurrence policy?
Under a 'claims occurring' basis of cover, a policy will provide cover for an insured event that occurs within the policy period, regardless of whether the claim is made during the policy period or some time afterwards (providing it is not statue barred).
What is the first thing an insurer must investigate before taking on a claim?
Insurance companies must search for and consider evidence that supports coverage for the claim. Thus, insurance companies cannot close their eyes to evidence that supports coverage and focus solely on the evidence that denies coverage. Too narrow a focus of investigation?
What is an example of occurrence?
Street-fights are an everyday occurrence in this area of the city. Death was an everyday occurrence during the Civil War. It's still not possible to accurately predict the occurrence of earthquakes. There have been several occurrences of theft in the area recently.
What is an example of per occurrence?
For example, say your policy's per-occurrence limit was $1 million and the aggregate limit was $2 million. Your company gets sued on two separate occasions in the same year, each time for $1 million. Because your per-occurrence limit is $1 million, both lawsuits will be covered.
What is a date of occurrence?
Definition: The date of occurrence of a vital event is the exact day, month and year (Gregorian calendar), as well as the hour and minute, if appropriate, when the event occurred.
What are the three types of insurance claims?
- Own damage claim. This is when your own car is damaged due to an accident. ...
- No-Fault Damage. You can make a No-Fault Damage claim from your own insurance company when the accident was not caused by you also with the condition that you have a Comprehensive cover. ...
- Third party claim.
Can I file a claim after my insurance expires?
In other words, the claim needs to be filed while you are actively covered. If you have cancelled your insurance or allowed the policy to lapse you will be uninsured and unable to claim. A retroactive claim for a loss can only be raised in a situation where the cover has been ongoing during that period.
What is the difference between per occurrence and per claim deductible?
A per occurrence deductible is like most auto or homeowners insurance you might be familiar with; you pay the $500, and that's the max you'll pay when something happens. But if your deductible is per claim, that means a separate deductible gets applied to every claim filed in a single occurrence.
What is an example of an occurrence policy?
An occurrence policy protects you from any incident occurring while the policy is in force. The policy then covers those incidents forever. For example, you buy a policy in 2010, treat Client X in 2011, and terminate the policy in 2012. In 2015, Client X sues you for an incident that occurred in 2011.
Should I get claims made or occurrence?
Key Takeaways: A claims-made policy only covers those that occur and are reported within the policy's timeframe, unless tail coverage is also purchased. An occurrence policy provides lifetime coverage for incidents that take place during a policy period, regardless of when the claim is reported.
What is the insurance definition of an occurrence?
In a commercial general liability (CGL) coverage form, an occurrence is an accident, including continuous or repeated exposure to substantially the same general harmful conditions.
What is the order of occurrence?
Chronological order is an arrangement of events in the order of their happening or based on the time they have occurred.
What is a thing that happens an occurrence?
An occurrence is an instance of something or a time when something happens. If you get migraines, the doctor might ask how many occurrences of the headache you have in a month. An occurrence is an instance of something that happens repeatedly.
What does $300000 per occurrence mean?
Per-occurrence limits define how much a policy will pay for any one incident or claim. Aggregate limits define how much a policy will pay over the policy's duration.
What is per occurrence insurance policy?
Many small business insurance policies limit the amount of money they'll pay for a single incident. This amount or cap is known as a per-occurrence limit. Third-party liability policies (policies that cover lawsuits from people outside your business) usually have a per-occurrence limit.
What is the difference between per accident and per occurrence?
Generally, per accident and per occurrence mean the same thing. One occurrence is a single, uninterrupted cause that can result in one or a number of bodily injuries or property damage.