In a commercial package policy, what does claims-made coverage mean?

• A. The claim must be made during the policy period.
• B. The claim must be filed within 30 days of occurrence.
• C. The policy covers all past and present losses automatically.
• D. The policy has no time limit on when a claim can be made.

Answer: (A)

Claims-made coverage is triggered by the moment a claim is reported to the insurer during the policy period. In this type of coverage, the key question is when the claim is made and received, not when the event occurred. That’s why the best answer states that the claim must be made during the policy period.

This differs from other ideas like needing to file within a set number of days after an incident, or automatically covering all past losses, which aren’t what defines claims-made. There is also generally a time limit for when a claim can be made under a given policy term, and without tail coverage or a retroactive date, claims reported after the policy ends may not be covered.