Liability insurance is crucial for safeguarding your business. However, the policy type you select can significantly impact the outcome when it’s time to file a claim. The two most prevalent options are occurrence policies and claims-made policies. At Hyman Brown Insurance Agency Inc. in Commerce, GA, we assist business owners in comprehending how these policies function, enabling them to make confident and well-informed decisions.

Understanding an Occurrence Policy

An occurrence policy offers coverage for incidents that transpire during the active period of your policy, even if the claim is filed years later. For instance, if an accident happens while your policy is active, but the resulting lawsuit doesn’t surface until a few years later, your occurrence policy would still respond to that claim. This policy type is often favored by businesses seeking long-term protection without the concern of the policy’s expiration date.

The Functioning of a Claims-Made Policy

Contrarily, a claims-made policy only covers claims that are both made and reported while the policy is active. Therefore, if the incident happened during your coverage period but the claim is filed after the policy ends, you might not be covered unless you’ve added an extended reporting endorsement, often referred to as tail coverage. These policies may offer lower premiums initially but necessitate meticulous policy management to prevent coverage gaps.

Selecting the Appropriate Protection

The choice between these two policies depends on your industry, your risk exposure, and the typical time it takes for claims to surface. At Hyman Brown Insurance Agency Inc in Commerce, GA, we’re here to assist you in navigating through the details and finding the policy that best suits your business. Contact us today to secure your future with confidence.