If you’re shopping for commercial insurance, you’ve likely come across the terms “occurrence” and “claims-made” policies. While they may sound similar, they function very differently in terms of how and when coverage applies. At L M Insurance & Financial Services LLC in Bronx, NY, we often help business owners understand which type of policy best fits their needs—and why it matters.

What Is an Occurrence Policy?

An occurrence policy provides coverage for claims arising from incidents that happen during the policy period, regardless of when the claim is filed. This means that if an event occurs while your policy is active—even if the claim is made years later—you’re still covered. Occurrence policies provide long-term peace of mind, making them ideal for industries where claims may arise long after the fact.

What About Claims-Made Policies?

Claims-made policies, on the other hand, only provide coverage if both the incident occurs and the claim is filed while the policy is active. If your policy ends and you don’t have tail coverage or a renewal, you could be left unprotected—even for incidents that happened during your coverage period. While claims-made policies are often more affordable upfront, they require careful management to avoid gaps in protection.

Choosing the Right Policy for Your Business

The best policy type depends on your business, industry, and risk tolerance. Some professions benefit more from the lasting protection of an occurrence policy. In contrast, others may find that claims-made policies are a cost-effective solution, provided the proper safeguards are in place.

If you’re unsure which policy is right for your business, L M Insurance & Financial Services LLC in Bronx, NY is here to help. Contact us today to ensure your business is covered—both now and in the future.