What's full prior acts insurance coverage?

Описание: https://robfreeman.com/full-prior-act... - Hey everybody. I'm Rob Freeman. And today we're talking about full prior acts coverage.

You may have heard this term "full prior acts" but what does it mean? And what are the implications of having this coverage in your insurance policy?

Well, full prior acts is a type of "claims made" insurance policy that covers any acts that occurred and that are reported during the policy period. Going back in time, doesn't matter when the act occurred.

This type of coverage is in contrast to having what's called a "retroactive date" in your policy.

With a retroactive date, anything that happens after that date that's reported during the policy period - as long as it complies with the terms of the insurance policy - would be covered.

So full prior acts means that anything prior to the policy period is covered, as long as it's reported within the policy period, and a retroactive date limits you to anything that is arising from an act that took place after the retroactive date.

So having a retroactive date in your liability policy is kind of like an exclusion for anything that happened prior to that.

So let's look at an example.

Let's say you have a professional liability policy with a policy term of January 1, 2020 to January 1, 2021. And the policy has a retroactive date of January 1, 2015.

If you have a claim that arises from an act that's reported during the policy period, but that happened in 2014, you would not have any coverage because it would have fallen before the retroactive date.

But if you have full prior acts coverage on your errors and omissions policy (also known as a professional liability policy) and you get a claim that is made within the policy period, even if the act that caused the claim occurred 20 years ago, it would be covered as long as it's covered under the policy.

So as you can see, it's preferable to have full prior acts coverage, but insurers typically don't want to provide full prior acts coverage unless you've already had insurance and that you've kept insurance in place and uninterrupted for the entire life of your company or for whatever period it is that you are trying to cover.

So, anyway, I hope this is helpful. If you have questions about full prior acts coverage or liability, professional liability, errors, and omissions, please schedule an appointment with me.

I love to answer your questions. Thanks again and have a great day.