In liability insurance, what does "occurrence" coverage mean?

In liability insurance, what does "occurrence" coverage mean?

• A. The event must happen before the policy expiration.
• B. The event must happen during the period of policy coverage.
• C. The policy pays a fixed amount regardless of incident timing.
• D. Occurrence coverage ensures only property damage.

Answer: (B)

Occurrence coverage triggers when the actual event that causes the damage or injury happens during the policy period. If the event occurs while the policy is in force, a claim filed later—even after the policy has expired—can still be covered, up to the policy’s limits. This differs from claims-made policies, which require the claim to be reported while the policy is active. The amount paid isn’t a fixed sum; it depends on the damages and defense costs up to the policy limits. And it can cover more than just property damage—for example, bodily injury and other liability types that arise during the period. So the best description is that the event must occur during the period of policy coverage.

Occurrence coverage triggers when the actual event that causes the damage or injury happens during the policy period. If the event occurs while the policy is in force, a claim filed later—even after the policy has expired—can still be covered, up to the policy’s limits. This differs from claims-made policies, which require the claim to be reported while the policy is active. The amount paid isn’t a fixed sum; it depends on the damages and defense costs up to the policy limits. And it can cover more than just property damage—for example, bodily injury and other liability types that arise during the period. So the best description is that the event must occur during the period of policy coverage.