Occurrence Policy

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WHAT IS the occurrence policy

A claims policy covers claims made for injuries sustained during the life of an insurance policy, even if the claim is filed after the policy is canceled. An event is an event which may lead to the filing of an insurance claim.

BREAKDOWN OF OCCURRENCE POLICY

Insurance companies can provide two types of liability insurance coverage through an accident and claims policy. Accident coverage covers incidents that occurred while the policy was in force, even if the claim was made after the policyholder subsequently changed insurance companies. For example, a person exposed to dangerous chemicals may not feel the effects until years later. Accident coverage will cover the employer and the former employee even if the injured person files a claim after retirement. Insurers generally cap the total coverage offered by such a policy. A form of cap limits the amount of coverage offered each year but allows the coverage limit to be reset each year. For example, a company that purchases five-year coverage with an annual cap of $ 1 million will allow the policyholder to have up to $ 5 million in total coverage.

Claims coverage against claims

Claims coverage is more common than event coverage. A claims-based policy provides coverage when a claim is made against the police, regardless of when the claim event occurred. A claims-based policy is more likely to be purchased when there is a delay between the time claims are made and the time they arise. Commercial insurance policies are often offered in the form of compensation or claims. While the claims policy provides coverage for claims when the event is reported, the occurrence policy provides coverage when the event occurs.

Claims-based policies are used to cover risks associated with business operations. For example, these policies are used to cover the potential for errors associated with errors and omissions in the financial statements. They are also used to cover companies against employee complaints, including unfair dismissals, sexual harassment and complaints of discrimination. These claims can be filed against a policy several months after the occurrence of the event. This type of responsibility is called responsibility for employment practices and can also cover the actions of directors and officers of the company. Until the mid-1960s, the wording of the allegations did not exist, and from the early to the mid-1970s its use was sporadic. The occurrence form now dominates, except for most exhibitions of professional and executive liability, where complaints have been applied.

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