Selecting the right professional liability insurance for your practice is a key decision. Understanding the differences between claims made coverage and occurrence coverage can help protect your business from potential financial and legal risks. Knowing how these coverage options work ensures you are adequately protected.
At Unity Insurance, a Maryland small business insurance agency, we specialize in helping professionals navigate their insurance needs. Below, we break down the key differences between claims made coverage and occurrence coverage to help you determine which option is best suited for your practice.
Understanding the Different Coverages
When it comes to purchasing medical malpractice insurance coverage in Maryland, there are two main types of policies medical professionals must understand: claims-made policies and occurrence policies.
Occurrence coverage provides protection for claims related to incidents that occurred while the policy was active, regardless of when the claim is filed. This means that even if a claim is brought against you years after the policy has expired, as long as the incident happened during the coverage period, you are still protected.
A claims-made policy provides coverage of both the incident and the claim occurring while the policy is active. Once the policy expires, coverage ends—unless you purchase tail coverage. Tail coverage, also known as an extended reporting endorsement, applies to claims-made policies, and extends the time frame in which a claim can be reported, ensuring you remain protected even after your policy has ended.
Which is the Correct Coverage for Me?
Both coverages offer protection while they are active, but the differences of how a claim is covered based on when it’s filed, is fundamental in deciding the best coverage:
Long-Term Protection
Occurrence Policies: Since coverage is based on when the incident occurred, there is no need for a tail to be purchased.
Claims Made Policies: Since coverage is based on both when the incident and claim occurred, a tail may need to be purchased after policy cancellation.
Premium Costs
Occurrence policies are typically more expensive than claims-made policies, but have a steady base rate. Claims made policies have lower initial premiums but may require supplemental tail coverage when cancelled.
How the Trusted Insurance Partners at Unity Insurance Can Help
Regularly reviewing and updating your business insurance policy may seem overwhelming, but working with a knowledgeable Maryland small business insurance agency simplifies the process. At Unity Insurance, we take a proactive approach to policy management, ensuring your practice is always adequately protected. Whether you’re expanding, upgrading equipment, or navigating regulatory changes, we’re here to help you make informed decisions.
If you need assistance with business insurance, medical office insurance, or employee benefits, our team is here to help. Contact us to schedule a policy review today!
Speak With An Agent At Unity Insurance About Your Virginia and Maryland Insurance Needs Today
Unity’s insurance professionals serve as your advocate from the very beginning. From selecting coverage to filing a claim, we are by your side every step of the way. At Unity Insurance, we know insurance plays a vital role in every stage of your life and business so our professionals provide guidance and support to ensure you make the right decisions regarding your insurance options.
We work with clients in Maryland and Virginia to provide the best plan for individual needs. Call 410-539-6642 to learn how the experienced insurance professionals at Unity Insurance can assist you.