What is a claims-made policy in EPLI?

Coverage in a claims-made EPLI policy is triggered when the insured organization reports a claim to the insurance company during the policy period. The key date is when the claim is made, not when the alleged wrongful act occurred.

Retroactive Date: Claims-made policies often have a "retroactive date" that specifies the earliest date from which claims will be covered. Claims arising from events or wrongful acts that occurred before this retroactive date are typically not covered. The retroactive date is usually the starting point for assessing prior acts coverage.

Extended Reporting Periods: Claims-made policies may offer "extended reporting periods" or "tail coverage" options. These allow the insured to report claims for a specified period (usually after the policy's expiration) related to events that occurred during the policy period. These extended reporting periods help bridge any potential coverage gaps when switching insurers or when a claims-made policy is canceled.