How does claims-made coverage work for Georgia professional liability?

Claims-made coverage protects you only if a claim is first brought against you while the policy is active, and usually only for work done after a set starting date called the retroactive date. This is the standard way Georgia professional liability is written, so understanding the timing is essential. Professional liability, also called errors and omissions, pays to defend and settle claims that you made a mistake in your professional services.

The key feature is timing. A claims-made policy responds based on when the claim is made, not when the mistake happened. So the policy must be in force on the day the client brings the complaint. This is different from an occurrence policy, which covers an incident based on when it happened, regardless of when the claim shows up later.

Two terms control how a claims-made policy behaves:

• Retroactive date, the earliest point at which your past work is covered. Anything you did before that date is not covered, even if the claim comes in while the policy is active.
• Tail coverage, also called an extended reporting period, which lets you report claims for a time after the policy ends, for work you did while it was in force.

Because of this structure, you must keep continuous coverage to stay protected. If you let a claims-made policy lapse without buying tail coverage, a claim that arrives after the lapse, even for work you did while insured, may not be covered.

For example, a Georgia accountant prepares a return in 2024 under a claims-made policy. In 2026, the client sues, claiming a $75,000 error. If she kept the policy active or bought tail coverage when she switched carriers, the claim is covered. If she dropped the policy with no tail and no retroactive coverage on the new one, she pays the defense and settlement herself.

When you move to a new claims-made policy, the best practice is to ask the new insurer to honor your existing retroactive date, often called full prior acts coverage. That way your years of past work stay protected under the new policy and you may not need to buy tail at all. If the new insurer will not match the date, tail coverage on the old policy becomes the safety net that closes the gap.

The retroactive date and tail are easy to mishandle when you change insurers. We can review your claims-made dates and make sure there are no gaps with a free coverage review at our coverage review page.