What is the claims-making trigger for a claims-made policy?

In a claims-made policy, the claims-making trigger is the date the claim is first made during the policy period. This type of policy provides coverage for claims only if they are reported while the policy is in force, rather than based on when the incident that caused the claim occurred. This means that if a policy is active and a claim is filed for an incident that happened during that time frame, the insurance company is liable for it, regardless of when the incident itself occurred.

For instance, if a policy runs from January 1 to December 31, and a claim for an incident that happened on June 1 is submitted on November 1, that claim would be covered, provided the policy is active. This structure encourages insured parties to report claims in a timely manner while the policy is effective. Understanding this principle is crucial for policyholders and producers alike to ensure that they are adequately covered for claims made during the life of their policy.