NOSE COVERAGE (Prior Acts Coverage or Retroactive Date)

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NOSE COVERAGE (Prior Acts Coverage or Retroactive Date) It is an optional add-on specifically applicable to claims-made insurance policies. It provides coverage for errors or omissions that occurred before the current policy period but are reported during the active coverage. First let us understand these two terminologies; -Claims-Made: Coverage applies to claims reported during the policy period, regardless of when the incident happened. -Occurrence: Coverage applies to incidents that occurred during the policy period, even if the claim is filed later. Why Nose Coverage Matters: 1- Gap in Coverage: Without nose coverage, a claims-made policy wouldn't cover incidents that happened before the policy inception date, even if you report the claim during your current policy period. 2- Peace of Mind: Nose coverage offers peace of mind by potentially covering past mistakes or oversights that come to light during your current policy. Nose coverage is particularly relevant for businesses or professionals with: -Long tail exposures: Professions where claims might arise much later, such as errors and omissions in professional services. (e.g., an architect's faulty design leading to structural problems years later) -Frequent policy changes: Businesses that switch insurance providers often might benefit from this coverage to bridge any gaps between policies. Example: Imagine you start a business on July 1st, 2024, and obtain errors and omissions (E&O) insurance with a July 1st, 2024 start date. You purchase nose coverage with a retroactive date of July 1st, 2023. In February 2025, a client sues you for malpractice based on a mistake you made in June 2023 (before your policy began). With nose coverage, this claim would potentially be covered, as the incident happened within the retroactive date and the claim is reported during your active policy period. Nose coverage in insurance acts like a safety net by potentially extending coverage for past mistakes or oversights reported during your current claims-made policy. #BeNewinsurance #InsurTech #inclusiveinsurance #insurance #reinsurance #takaful

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