Everything you need to know about a ‘Claims-Made’ Policy

Claims-made insurance is not difficult to understand once you know which dates matter. Unfortunately, it is often explained in language that makes it sound far more complicated than it is. A claims-made policy generally needs to be active when a claim is first made against you and reported to the insurer. The event giving rise to the claim must also fall after the retroactive date shown in your policy schedule.

This differs from occurrence-based cover, which generally responds according to when the incident took place. That distinction is particularly important for medical practitioners. A patient may only make a complaint or claim months or years after the consultation, procedure or treatment concerned. If your policy has lapsed, your retroactive date has changed or the matter was not reported correctly, you may discover a gap when you need the cover most.

We provide access to medical malpractice insurance on a claims-made basis. Our brokers also help practitioners understand how continuous insurance, retroactive dates and notification obligations work in practice.

What is a claims-made policy?

A claims-made policy generally covers eligible claims that are first made against the insured and notified to the insurer during an active policy period, subject to the policy’s terms, conditions, exclusions and retroactive date.

For cover to respond, the following will usually need to be true:

1. The professional service or incident occurred after the applicable retroactive date.
2. A claim was first made against you during the active policy period.
3. You notified the insurer in accordance with the policy’s reporting requirements.
4. The claim arose from professional activities declared to and accepted by the insurer.
5. No policy exclusion applies.

The exact trigger and reporting requirements depend on the policy wording. This is why you should not rely only on a general explanation of claims-made insurance. Your schedule and wording must always be read together.

The three dates you need to understand

Claims-made cover becomes much easier to follow when you separate three important dates.

1. The incident date

This is when the consultation, treatment, procedure, advice or alleged professional error occurred. For example, a doctor may have treated a patient on 10 March 2023.

2. The claim date

This is when the patient or another claimant first makes a claim or communicates an intention to hold the practitioner responsible. The definition of a “claim” will be set out in the policy. It may include more than a court summons. A written demand for compensation, attorney’s letter or formal allegation may already constitute a claim. In our example, the patient may first send a letter of demand on 20 June 2026.

3. The notification date

This is when you report the claim or circumstance to your broker or insurer.

If the letter of demand is received on 20 June 2026 and sent to Shackleton Risk on the same day, 20 June 2026 is also the notification date. For a claims-made policy to respond, the relationship between these dates must satisfy the wording of the policy.

A simple claims-made example

Imagine that Dr Smith first arranged uninterrupted claims-made medical malpractice cover on 1 January 2022. The policy schedule records 1 January 2022 as the retroactive date. Dr Smith treated a patient in August 2023. The patient first alleged negligence and demanded compensation in May 2026. Dr Smith’s policy was active, and the matter was reported to his broker immediately.

The claim may fall within the policy’s time requirements because:

• The treatment occurred after the retroactive date.
• The claim was made while the policy was active.
• The claim was promptly reported.
• Dr Smith had maintained continuous cover.

The insurer would still need to consider whether the claim falls within the insured professional activities and whether all other policy terms have been met.

Now imagine that Dr Smith simply allowed the policy to lapse or chose not to renew it in December 2025. When the patient made the claim in May 2026, there was no active claims-made policy.

Even though Dr Smith had insurance when the treatment took place, the lapsed policy may not respond to a claim first made after it ended. That is the key risk practitioners need to understand.

There may, however, be an important exception where the policy ends because the practitioner permanently stops practising for a qualifying reason. Depending on the policy terms, an 

Extended Reporting Period (ERP) may apply following retirement, death, permanent disability, emigration or a permanent return to full-time state employment.

An ERP allows eligible claims arising from professional services provided before the policy ended to be reported during the extended period. It does not provide cover for new professional services performed after the termination date.

Therefore, if Dr Smith had ended the policy for a qualifying reason and an applicable ERP was in place, the claim made in May 2026 could still be considered. Cover would remain subject to the retroactive date and all other terms, conditions, limits and exclusions of the policy.

Practitioners should speak to Shackleton Risk before cancelling their cover or stopping private practice so that the applicable ERP provisions can be confirmed and properly arranged.

Claims-made and occurrence-based cover compared

Both forms of cover can provide valuable protection, but they use different events to determine which policy responds.

	Claims-made cover	Occurrence-based cover
Main trigger	The claim is first made and reported during the active policy period	The incident occurred during the active policy period
Retroactive date	Usually important	Generally not required
Continuous cover	Important because a later claim may need a current policy	The policy in force when the incident occurred may respond later
Changing insurers	The existing retroactive date should usually be preserved	Earlier incidents generally remain linked to the earlier occurrence policy
Cover after retirement	Run-off or extended reporting protection may be needed	Earlier insured incidents may remain covered under the historical policy
Notification	Claims and reportable circumstances must be disclosed according to the policy	Notification requirements still apply, but the incident date determines the relevant policy

Neither structure is automatically better in every situation. What matters is understanding which one you have and managing it correctly. Genoa provides a more detailed explanation in its comparison of claims-made and occurrence-based medical malpractice cover.

What is a retroactive date?

The retroactive date is the earliest date from which professional work may be considered under a claims-made policy. If the event giving rise to a claim occurred before the retroactive date, the policy will generally not respond, even if the claim itself is made and reported during the current policy period.

As Genoa explains in its retroactive-date guidance, the retroactive date marks the earliest date on which an incident must have occurred to fall within the policy’s time period.

How is the retroactive date established?

For a practitioner taking out claims-made cover for the first time, the retroactive date may be the date on which the policy begins. If the practitioner already has uninterrupted claims-made cover, the insurer may agree to preserve the existing retroactive date when the cover is transferred. This is subject to underwriting and must be shown correctly on the new schedule.

For example, if you first arranged claims-made cover on 1 January 2020 and have maintained it continuously, your retroactive date may remain 1 January 2020 even though you renew the policy every year. If the date is incorrectly changed to the latest renewal date, several years of earlier professional work could be left outside the cover.

Check your retroactive date every year and whenever you change insurer, broker, practice entity or policy structure.

Why continuous cover matters

A claims-made policy protects against claims made during the active policy period, subject to its terms. If the policy ends and no suitable extended reporting protection has been arranged, claims first made after termination may not be covered.

A gap of only a few weeks can create a problem. Imagine that a practitioner’s policy expires on 31 December and the replacement policy only begins on 1 February. A claim first made during January may fall between the two policies. The earlier policy may not respond because the claim was made after it ended, while the later policy may treat it as a pre-existing or known matter.

Do not allow claims-made medical malpractice cover to lapse while you are still practising. If a lapse has already occurred, disclose it honestly when applying for replacement cover.

What counts as a claim?

Many practitioners assume that they only need to notify their insurer when a summons is served. That is often too late. The policy wording will define a claim, but it may include:

• A written demand for compensation
• An attorney’s letter alleging negligence
• A request for a refund linked to alleged harm
• A formal patient complaint
• A summons or other court document
• A notice from the HPCSA or another regulator
• An allegation that the practitioner caused injury or loss

Not all complaints will fall within the policy definition of a claim. However, they may still be reportable circumstances. If you are unsure, send the document to Shackleton Risk and ask whether it should be notified. Reporting a matter does not amount to an admission that you were negligent.

What is a reportable circumstance?

A circumstance is an incident, event or situation that may reasonably be expected to lead to a claim in the future. Examples may include a serious unexpected outcome, a procedural error, a threat of legal action, a breakdown in the practitioner-patient relationship or knowledge that important follow-up did not take place.

The patient does not necessarily need to have demanded compensation yet. Genoa’s claims and incident-reporting guidance explains the importance of informing the broker or insurer when a risk event has occurred.

Notifying a circumstance during the active policy period may allow a later related claim to be treated under that policy, depending on the wording and the adequacy of the notification. A vague statement such as “there may be a claim one day” may not be sufficient. Provide the available facts, relevant dates, patient details, nature of the incident and reasons you believe a claim could arise.

Why prompt notification is so important

Claims-made policies contain specific notification conditions. These may require a claim or circumstance to be reported as soon as reasonably possible or within a defined period.

Prompt notification allows the claims team to:

• Preserve clinical and electronic records
• Obtain an early account from the practitioner
• Identify the people involved
• Investigate while memories are fresh
• Appoint suitable attorneys and medical experts
• Guide communication with the patient
• Prevent an unapproved admission or settlement
• Meet court or regulatory deadlines

Do not delay notification while you investigate the matter yourself. You can provide additional documents and a fuller chronology after the initial report. Do not admit liability, offer compensation or incur legal costs without approval from the insurer.

What happens when you renew the policy?

Renewing a claims-made policy is part of maintaining continuous protection. It is also an opportunity to check that the policy still matches your practice.

At every renewal, confirm:

1. The insured practitioner and practice entities are correct.
2. Your scope of practice is accurately declared.
3. All procedures and professional activities are included.
4. The retroactive date has been preserved.
5. The indemnity limit and annual aggregate remain appropriate.
6. Employees, locums and additional practitioners are correctly recorded.
7. Every known claim or circumstance has been disclosed.
8. Any new exclusion, excess or endorsement is understood.

Renewal does not correct an earlier failure to report a known matter. If you become aware of a potential claim during the policy year, notify Shackleton Risk immediately rather than waiting for the renewal form.

What happens when you change insurers?

Changing insurers requires more care than simply cancelling one policy and starting another. The new insurer needs to consider your existing retroactive date, claims history, known circumstances and continuity of cover. The dates on the two policies should align so that no uninsured gap is created.

Before changing a claims-made policy, ask:

• Will the new insurer preserve my existing retroactive date?
• Is there any gap between the old and new policy periods?
• Have all known claims and circumstances been reported to the current insurer?
• Does the new policy cover the same professional activities?
• Are any new exclusions or sub-limits being introduced?
• Does the new policy define a claim or circumstance differently?
• What happens to claims arising from earlier work?

A lower premium should not be considered in isolation. The value of the earlier retroactive date and the quality of the replacement wording may be far more important. Do not cancel existing cover until the replacement terms have been accepted and checked.

What if you move from occurrence-based to claims-made cover?

If your previous cover was written on an occurrence basis, incidents that took place during that policy period may remain linked to the occurrence policy, even if a claim is made later. The new claims-made policy may then begin covering work from its own inception date. 

Genoa notes that retroactive cover may not be required when a practitioner is moving from occurrence-based protection to a claims-made policy, because the earlier occurrence policy should remain responsible for incidents during its period.

This should still be confirmed carefully. Obtain and preserve copies of the earlier policy schedules and wordings. You may need them years later if a patient makes a claim arising from historical treatment.

What is an extended reporting period?

An extended reporting period, sometimes called tail or run-off cover, allows certain claims to be reported after the active claims-made policy has ended. It generally does not cover new treatment performed after the policy terminates. Instead, it provides an additional period in which claims arising from earlier insured work can be reported.

The length, price and terms of an extended reporting period will depend on the policy and reason for ending cover. This protection may be important when a practitioner:

• Retires
• Emigrates
• Closes a practice
• Stops private practice
• Takes an extended career break
• Moves permanently into a different scope
• Dies or becomes permanently disabled
• Cancels claims-made cover without replacing it

Run-off arrangements should be discussed before the active policy ends. They may be more difficult or expensive to arrange after cancellation. Genoa’s guidance on the early termination of medical malpractice cover explains why stopping a claims-made policy without addressing earlier work can leave a practitioner exposed.

Does retirement end the risk of a claim?

No. Retirement ends new clinical work, but it does not prevent a patient from making a claim about treatment provided in the past. This is particularly important in specialties where harm may only become apparent later or where claims may be brought on behalf of children.

A retired practitioner may no longer have practice income available to fund a defence. Appropriate run-off protection therefore needs to be considered as part of the retirement plan, not as an afterthought once the policy has been cancelled.

How do limits and aggregates work under claims-made cover?

The timing trigger is only one part of the policy. A covered claim is also subject to the selected limit of indemnity and annual aggregate. The per-claim limit is the maximum available for one covered claim. The annual aggregate is the maximum available for all covered claims made and reported during the policy period.

Because a claims-made policy groups claims according to when they are made or reported, several claims relating to work performed in different years may affect the same current policy aggregate.

For example, one claim could arise from treatment in 2022 and another from treatment in 2025. If both claims are first made and reported during the 2026 policy period, they may both reduce the 2026 annual aggregate. This is one reason the aggregate and any reinstatement options should be reviewed carefully.

Common claims-made mistakes

Claims-made cover can work well when it is managed correctly. Problems usually arise from misunderstandings about dates, disclosure and notification.

Common mistakes include:

• Assuming that having cover on the treatment date is enough
• Allowing the policy to lapse
• Failing to preserve the existing retroactive date
• Waiting for a summons before reporting a problem
• Notifying a circumstance too vaguely
• Cancelling cover immediately upon retirement
• Changing insurers based only on premium
• Failing to disclose known complaints or incidents
• Assuming an employer’s policy covers private work
• Losing copies of earlier policies and schedules

Most of these problems can be avoided by speaking to Shackleton Risk before making changes.

Five questions to ask about your claims-made policy

You should be able to answer these questions without hesitation:

1. What is my retroactive date?
2. Which professional activities are insured?
3. What must I report as a claim or circumstance?
4. What happens if I retire, emigrate or stop practising?
5. What limit and annual aggregate are available?

If any answer is unclear, ask for it to be explained in writing.

Protect the value of continuous cover

The most important thing to remember about a claims-made policy is that today’s insurance may need to respond to yesterday’s professional work. That protection depends on the policy remaining active, the retroactive date being preserved and claims or circumstances being reported correctly. Before changing insurers, ending cover or altering your practice, contact your Shackleton Risk broker. We can explain how the change may affect your claims-made protection and help you avoid an unintended gap. 

This article provides general information and does not constitute legal, medical or insurance advice. Cover is subject to underwriting and the terms, conditions, limits and exclusions of the applicable policy. Practitioners should obtain advice based on their individual circumstances.