The claims process for many liability insurance plans is limited to the reporting period for which the policy is written. Therefore, coverage could be extended to claims that are made within an active policy and denied if filed after the coverage period has expired. However, there are some industries or professions where claims may arise long after a policy has been active, leaving an individual or company responsible for the costs of resolution. Rather than take chances with this exposure, the team at https://www.huntersure.com/ recommends that those who purchase liability insurance strongly consider including prior acts coverage.
Understanding Prior Acts
Including prior acts in the policy allows claims to be made for insurable events even if the act occurred prior to the origination of the current policy. For example, a surgeon has just changed providers for his malpractice insurance. However, a claim arises from an incident that happened eight months ago. Prior acts coverage could allow the current policy to be retroactive in addressing the situation. Insurance providers will usually establish a retroactive date that determines how far back coverage may be extended. Coverage areas may include:
- Legal assistance cost
- Actual or simply alleged negligence
- Claims and damages
- Personal injury
The extent of a policy’s terms and coverage is determined by need and what the provider allows. If you are in the process of switching providers, don’t forget to check on potential prior acts inclusion.