Claims-made vs occurrence, and your coverage after you stop practising

What is the difference between claims-made and occurrence?

A claims-made policy responds to a claim that is first made against you, and reported, while that policy is in force, as long as the work happened after the policy’s retroactive date. An occurrence policy responds to an incident that happened during the policy period, no matter when the claim shows up. One form looks at when the complaint arrives. The other looks at when the work was done.

Side by side, the differences come down to four points:

• What triggers it. Claims-made: the claim is made and reported during the policy. Occurrence: the incident happens during the policy period.
• Which policy year responds. Claims-made: the one in force when the claim arrives. Occurrence: the one in force when the work was done.
• Retroactive date. Claims-made: yes, past work is covered back to this date. Occurrence: not used.
• After the policy ends. Claims-made: new claims go unanswered unless a tail is in place. Occurrence: claims about work done during the policy period still go to that policy.

From an insurer’s side, claims-made makes sense. It lets them price the claims they can see coming in a given year instead of carrying an open-ended promise for work done a decade ago. And to be clear: that is entirely their right. It just means the job of keeping coverage continuous falls to the practitioner.

Which form do Ontario practitioners usually carry?

Claims-made is the form we see most often on Ontario practitioner policies. Erik Malthaner puts it this way: “Claims-made is the most common, but we’re starting to see a trend toward occurrence.” The policy wording states the form, and the certificate of insurance usually does too, so it takes about two minutes to confirm at any renewal. It’s the first thing to find before any other question about past work.

What is a retroactive date, and why does it matter when you switch insurers?

A retroactive date, often shortened to retro date, is the earliest date of work a claims-made policy looks back to. Work done before it falls outside that policy, even if the claim arrives today. When a practitioner moves to a new insurer or a new association plan, the question is whether the new policy keeps the old retro date or starts a fresh one on the day of the switch.

Keeping the original date is called continuity of prior acts coverage, meaning the work you did before the switch stays insured under the new policy. A fresh retro date leaves earlier work without a policy that will answer for it. That gap doesn’t show on renewal day, because nothing’s gone wrong yet.

Insurers differ on whether they match an existing retro date, and the declarations page of the new policy shows which date applies. It’s one line of text. It carries years of your work.

What happens to your coverage when you retire, take leave or close your practice?

The policy form decides it. As Erik Malthaner explains: “On a claims-made policy, past work stays insured after the policy ends only if a tail is in place. On an occurrence basis, a tail isn’t required.” When a claims-made policy simply lapses at retirement, a complaint that arrives later has no policy to go to, even though the practitioner did the work while insured.

Picture the call, two years after a practitioner closes up shop:

“I retired in the spring of last year. Why does a letter about a client from three years ago matter now?”

“Because the claim is being made now, and the policy that would have answered it ended when you stopped.”

What is tail coverage?

Tail coverage, also called an extended reporting period, adds time after a claims-made policy ends to report claims about work done while it was in force. It doesn’t cover new work. Length and terms vary by insurer, and some wordings offer it only at set points, such as retirement or cancellation.

Do some Ontario colleges set a minimum run-off period?

Yes. Several Ontario health regulatory colleges set a minimum period in their by-laws during which coverage has to keep responding after a registrant stops practising, and the length differs from one college to the next. Unregulated practitioners have no college rule, although an association or a contract sometimes sets one. For a regulated practitioner, the college’s insurance by-law is where the exact number sits.

What about a contractor who leaves a clinic?

Clinic owners often overlook this one: whether contractors on claims-made policies keep their coverage in place after they leave. A complaint about a former contractor’s work can still name the clinic years later, and by then the contractor’s own policy has sometimes lapsed.

Why does late reporting matter on a claims-made policy?

Because the policy that responds is the one in force when the claim is made and reported, and claims-made wordings set conditions on when and how notice is given. Notice that arrives after the policy year has closed falls outside the policy that would have answered it, which is why the reporting date on a claims-made policy matters as much as the date of the work.

Some wordings also allow notice of a circumstance, meaning an incident that has not yet turned into a claim, before any complaint arrives. That notice ties a later claim to the current policy year under those wordings.

On any complaint, the same habits help: prompt action, records kept exactly as they were, and a factual timeline written while the details are still fresh.

How long after treatment can a claim arrive in Ontario?

Longer than most practitioners expect. Ontario’s Limitations Act, 2002 sets a basic two-year limitation period that runs from the day a claim is discovered, not the day of the treatment, and an ultimate limit of 15 years from the act itself, with special rules for minors. A complaint about work from years ago can still arrive after a claims-made policy has ended.

That gap between the work and the claim is the whole reason the policy form matters. An occurrence policy closes it by looking back to the date of the work. A claims-made policy closes it with continuous coverage, a matching retro date, and a tail when the practice stops.

What is worth checking before your next renewal?

Four lines on the declarations page answer most of these questions: whether the policy is claims-made or occurrence, the retroactive date, whether a tail is available and on what terms, and how the wording defines when a claim is made. None of them is hard to find, and every one of them is easier to sort out while the current policy is still in force.

Find your form. Find your retro date. And if a switch, a new association plan or a step away from practice is coming, talk to a broker before the date rather than after it, because that is when every option is still open.

Because the policy doesn’t wait for you to be wrong, and it starts on the day someone says you were.