What is the primary difference between occurrence insurance and claims-made policy?

Occurrence insurance is designed to cover incidents that occur during the policy period, regardless of when a claim is actually made. This means that if an event leading to a claim occurs while the policy is active, the coverage applies even if the claim is filed after the policy has expired. This long-tail nature of occurrence insurance gives the insured peace of mind, knowing they are protected for past incidents as long as they happened during the term of the coverage.

On the other hand, claims-made policies only provide coverage for claims that are reported during the policy period. This means if an incident occurs and the claim is filed after the policy has expired, there would be no coverage available under a claims-made policy.

Thus, the defining characteristic of occurrence insurance is its focus on the timing of the incident rather than the timing of the claim, effectively covering claims regardless of when they are made, as long as the incident itself occurred while the policy was active.