11.2 Occurrence vs. Claims-Made CGL and Retroactive Dates
Key Takeaways
- Occurrence forms (CG 00 01) trigger when injury occurs in the period; claims-made forms (CG 00 02) trigger when the claim is first made in the period.
- The retroactive date bars any loss that occurred before it - never advance it without a tail.
- Claims-made offers a free Basic ERP (mini-/midi-tail) and an optional purchased Supplemental ERP (unlimited tail), buyable within 60 days of expiration.
- Claims-made premiums step up annually until maturity (about year 5); switching to occurrence creates a gap unless a SERP is purchased.
Two Coverage Triggers, One Form Family
ISO issues the CGL in two trigger versions: the Occurrence form (CG 00 01) and the Claims-Made form (CG 00 02). The trigger determines which policy year responds to a loss - a heavily tested distinction.
Under an occurrence trigger, coverage applies if the bodily injury or property damage occurs during the policy period, no matter when the claim is reported - even years later. Under a claims-made trigger, coverage applies only if the claim is first made against the insured during the policy period (or an extended reporting period), and the injury occurred on or after the retroactive date.
The Retroactive Date and Reporting Tails
The retroactive date is the linchpin of claims-made coverage. Injury or damage that happens before the retro date is never covered, regardless of when the claim is reported. Advancing (moving forward) a retro date silently strips coverage for prior years - which is why exams stress that a retro date should not be advanced without an extended reporting period.
Claims-made policies offer two tails:
- Basic Extended Reporting Period (BERP): automatic, no charge. Includes a mini-tail (claims reported within 60 days after expiration) and a midi-tail (claims for occurrences reported to the insurer within 60 days, then claimed within 5 years).
- Supplemental Extended Reporting Period (SERP): optional, must be purchased within 60 days of expiration, provides an unlimited reporting tail and reinstates aggregate limits.
Comparison Table
| Feature | Occurrence (CG 00 01) | Claims-Made (CG 00 02) |
|---|---|---|
| Trigger | Injury occurs in period | Claim first made in period |
| Retroactive date | None | Required; bars prior losses |
| Late-reported claims | Always covered if occurred in period | Need ERP / tail |
| Long-tail exposure | Insurer holds risk for years | Reduces insurer's tail risk |
| Premium maturity | Stable | Steps up years 1-5 as exposure matures |
| Tails | N/A | BERP (free) + SERP (purchased) |
Claims-made premiums start low ("first-year" or immature) and increase each year until the policy reaches maturity (typically year 5), because each renewal covers an additional year of prior acts back to the retro date.
Worked Scenario: Which Policy Responds?
An insured had a claims-made CGL from 1/1/2023-1/1/2024 with a retroactive date of 1/1/2023, then switched to an occurrence CGL effective 1/1/2024.
- A bodily injury occurred in June 2023 but the claim was first made in March 2024. Under claims-made, the 2023 policy's period has ended; the claim was made in 2024, after that policy expired. Without a SERP, the 2023 claims-made policy will not respond unless reported within its tail.
- The 2024 occurrence policy will not respond either - the injury occurred in 2023, before that policy incepted.
This classic "gap" is why a buyer switching from claims-made to occurrence should purchase a SERP (tail) on the expiring claims-made policy to capture late-reported prior-act claims.
Occurrence vs. Claims-Made CGL Side by Side
| Feature | Occurrence CGL | Claims-Made CGL |
|---|---|---|
| Trigger | Injury/damage happens during the period | Claim first made during the period |
| Retro date | None | Yes — bars losses before it |
| Long-tail fit | Weaker (stale limits) | Stronger (current limits respond) |
| ERP / tail | Not needed | Needed when policy ends |
| Stacking risk | Multiple years can respond | One policy responds |
Claims-made forms also include the 5-year reporting window and laser retroactive dates; the exam tests that switching from occurrence to claims-made (or changing carriers) can open a coverage gap unless a tail or prior-acts endorsement bridges it.
Worked "Which Policy Responds?" Scenario
An injury occurs in 2024 but the claim is filed in 2026. Under a 2024 occurrence policy, that policy responds because the injury happened in its period — even though it has expired.
Under claims-made, the 2026 policy responds only if its retroactive date is 2024 or earlier; if the retro date is 2025, the 2024 injury is excluded and there is no coverage absent prior-acts. This dual analysis — find the trigger, then check the retroactive date — answers nearly every CGL timing question. When in doubt on a claims-made gap, the safe producer recommendation is to purchase a Supplemental Extended Reporting Period before the old policy lapses.
Extended Reporting Periods on the CGL
The claims-made CGL provides two reporting tails. The Basic ERP is automatic and free: a short tail (60 days) for claims made shortly after expiration, plus a 5-year window for occurrences reported during the policy that later mature into claims.
The Supplemental ERP is purchased (within 60 days of expiration) and extends reporting indefinitely for occurrences before the policy ended; it is non-cancelable and the premium is capped by the form (often up to 200% of the annual premium). The retroactive date never advances under any tail. On a "which policy responds and is there a gap?" question, the safe answer when switching carriers is to buy the Supplemental ERP or obtain prior-acts coverage.
An insured has a claims-made CGL with a retroactive date of January 1, 2024. A bodily injury occurred on December 15, 2023, and the claim is first made during the current 2025 policy period. Is the claim covered?
Which statement about the Supplemental Extended Reporting Period (SERP) on a claims-made CGL is correct?