What does claims-made mean on a professional liability policy?

“Claims-made” describes when a professional liability policy will respond. A claims-made policy covers a claim only if the claim is first made against you while the policy is active, and usually only if the act that caused it happened after a set retroactive date. Professional liability, sometimes called errors and omissions, pays to defend and settle claims that you made a mistake in your professional work.

This is different from an “occurrence” policy, which covers any incident that happened during the policy period no matter when the claim shows up later. With claims-made, the timing of the complaint is what counts, so you must keep continuous coverage in force to stay protected.

Two terms control how it works. The retroactive date is the earliest point your past work is covered. Tail coverage, also called an extended reporting period, lets you report claims after you cancel or switch policies for work you did while insured.

For example, a Georgia consultant gives advice in 2024 under a claims-made policy. A client sues in 2026 saying the advice cost them $80,000. If the consultant kept the policy active or bought tail coverage, the claim is covered. If she dropped the policy with no tail, she pays out of pocket.

The retroactive date and tail are easy to lose track of when you change carriers. Let us check your professional liability dates with a free coverage review at our coverage review page.