What is a claims made policy?

A claims made policy is an insurance policy that provides coverage for a certain period of time, usually one year. In Nevada, this type of policy is commonly used in liability insurance for businesses. It covers legal liability that occurs during the policy period for claims that are reported to the carrier during that same period. The main benefit of a claims made policy is that it allows for a company to carry relatively low liability insurance costs, since insurers are only obligated to pay for claims reported and made during the policy period. This also allows companies to tailor their coverage to their needs, since they are not responsible for claims made prior to the start of the policy or after it has ended. A claims made policy may also require an extended reporting period, which is an additional period of time during which claims made after the policy has expired can be reported and still be covered. This period is usually available for a certain fee, and can be especially beneficial for companies that may experience a long-tail liability issue, where the claim may not be reported and paid until beyond the regular policy period. Overall, a claims made policy is a type of insurance policy that provides coverage for a certain period of time, and requires claims to be reported during that same time. It is especially beneficial for companies looking to keep their liability insurance costs low and to tailor their coverage to their specific needs.

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