FAQ

See Prior Acts Coverage.

Prior acts coverage refers to how far back in time the errors or omissions of insured are covered under a policy. This coverage limitation, should there be one, is expressed as a prior acts retroactive date. In the absence of a prior acts date the policy would afford full prior acts coverage with no date limitation.

An extended claim reporting period, also known as tail coverage, extends the period of time in which claims may be reported to an insurer after the expiration date of the policy. The time period for the endorsement can range from one year to an unlimited period of time depending upon the insurer. Generally there is an additional premium for this endorsement that is based upon the length of time selected.

A deductible is a designated amount stated in a policy that a policyholder will be required to pay in the event of a claim. An annual aggregate deductible provision limits the insured's deductible exposure to the amount stated in the policy regardless of the number of claims made during a given policy year. A loss only or first dollar defense deductible provision does not require the payment of the deductible until such time as there is a loss payment made by the insurance company.

A claims made policy is a policy form that requires claims to be made or reported to the insurer during the policy period in order for coverage to apply. Some policies allow for claims reporting within 30 to 60 after the expiration date of the policy.

A claims expenses outside the limits of liability policy provision does not deduct claims expense from the limits of liability.

A claims expenses inside the limits of liability policy provision requires that claims expenses be deducted from the available limit of liability.

A broker of record letter is a letter executed by an insurance applicant authorizing a specific broker to act as their agent in procuring insurance coverage. An exclusive authorization letter authorizes only one broker the ability to transact insurance on behalf of the applicant thereby eliminating all other brokers from competing in the quoting process. A carrier specific broker of record letter grants a specified broker the exclusive permission to transact with a specific carrier on behalf of the applicant.

Broker fees are fees that may be assessed by an insurance broker or wholesaler in addition to the premium charged.