What is typically required for a claim to be valid in a claims-made policy?

In a claims-made policy, a key requirement for a claim to be valid is that the incident must occur during the policy period. This type of insurance policy provides coverage for claims that are made against the insured during the policy term for incidents that occurred within the same period. This characteristic distinguishes claims-made policies from occurrence-based policies, which provide coverage for incidents regardless of when the claim is made, as long as the event occurred during the policy period.

The focus on timing is critical; if an event leading to a claim happened before the policy period began, that claim would not be covered, even if the claim is made while the policy is active. This is a fundamental aspect that policyholders need to understand when selecting insurance coverage and filing claims.