What is the difference between claims-made and occurrence insurance?

In California, two types of insurance policies are available – claims-made and occurrence insurance. The main difference between them is when the insurance coverage kicks in and when it ends. Claims-made insurance starts when the policy is put in place and only covers claims that are made during the policy period. This means if a claim occurs outside of the policy period, it won’t be covered. Occurrence insurance is different. With occurrence insurance, coverage starts at the time of the incident, regardless of when the claim is made. This means if an incident happens during the policy period, but the claim is made after the policy ends, the insurance company will still cover the claim. The choice between claims-made and occurrence insurance depends on the circumstances, but generally, occurrence insurance is recommended for higher liability risks. This is because you may not be aware of the claim until after the policy ends.

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What is the difference between claims-made and occurrence insurance?

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