Study guide
11.2 Occurrence vs. Claims-Made CGL and Retroactive Dates
Arkansas Property & Casualty Insurance State
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1 Standalone Coverage Map
Standalone Coverage Map
2 Introduction: Arkansas Property & Casualty Insurance Exam Overview
Arkansas Property & Casualty Exam Overview
3 National Portion: Insurance Fundamentals
1.1 Risk, Hazards, Perils, and the Law of Large Numbers 1.2 Insurable Interest, Indemnity, and Other Insurance Principles 1.3 Insurance Contract Law and Elements 1.4 Policy Structure: Declarations, Insuring Agreement, Conditions, Exclusions 1.5 Parties, Agents vs. Brokers, and Authority
4 National Portion: Property Insurance Concepts
2.1 Causes of Loss / Named-Peril vs. Open-Peril 2.2 Valuation: ACV, Replacement Cost, and Functional Value 2.3 Coinsurance and the Coinsurance Formula 2.4 Deductibles, Limits, and Loss Settlement 2.5 Common Property Policy Conditions and Clauses
5 National Portion: Dwelling Policies (DP)
3.1 Dwelling Policy Forms DP-1, DP-2, DP-3 3.2 Dwelling Coverages A-E and Other Coverages 3.3 Dwelling Perils, Conditions, and Endorsements 3.4 Mobile Home and Specialized Dwelling Coverage
6 National Portion: Homeowners Policies - Forms & Section I
4.1 Homeowners Forms HO-2 through HO-8 and Eligibility 4.2 Section I Coverages A-D and Additional Coverages 4.3 Section I Perils Insured Against and Exclusions 4.4 Replacement Cost vs. ACV and Loss Settlement in Homeowners
7 National Portion: Homeowners Policies - Section II & Endorsements
5.1 Section II Coverages E (Liability) and F (Medical Payments) 5.2 Homeowners Conditions and Duties After Loss 5.3 Common Homeowners Endorsements (scheduled property, water backup, ordinance or law)
8 National Portion: Personal Auto Policy - Liability & Injury
6.1 Personal Auto Policy Structure and Eligibility 6.2 Part A Liability and Supplementary Payments 6.3 Part B Medical Payments 6.4 Part C Uninsured/Underinsured Motorists
9 National Portion: Personal Auto Policy - Physical Damage & Duties
7.1 Part D: Coverage for Damage to Your Auto 7.2 Exclusions and Part E: Duties After an Accident 7.3 Part F: General Provisions, Endorsements, and No-Fault Concepts
10 National Portion: Liability Insurance Concepts
8.1 Negligence, Torts, and Legal Liability 8.2 Defenses, Damages, and Vicarious Liability 8.3 Occurrence vs. Claims-Made Triggers 8.4 Bodily Injury, Property Damage, and Personal/Advertising Injury
11 National Portion: Commercial Property Insurance
9.1 Commercial Package Policy Structure and Common Policy Conditions 9.2 Building and Personal Property Coverage Form (BPP) 9.3 Causes of Loss Forms (Basic, Broad, Special) 9.4 Business Income and Extra Expense 9.5 Commercial Property Endorsements and the BOP
12 National Portion: Commercial General Liability - Coverages
10.1 CGL Coverage A: Bodily Injury and Property Damage Liability 10.2 CGL Coverage B: Personal and Advertising Injury, Coverage C: Medical Payments 10.3 Who Is an Insured and Supplementary Payments
13 National Portion: Commercial General Liability - Limits, Triggers & Exclusions
11.1 CGL Limits of Insurance and Aggregates 11.2 Occurrence vs. Claims-Made CGL and Retroactive Dates 11.3 Key CGL Exclusions and Endorsements
14 National Portion: Commercial Auto Insurance
12.1 Business Auto Coverage Form and Covered Auto Symbols 12.2 Commercial Auto Liability and Physical Damage 12.3 Motor Carrier / Trucking and MCS-90 12.4 Garage Coverage Form and Garagekeepers 12.5 Commercial Auto Endorsements
15 National Portion: Workers Compensation
13.1 Workers Compensation Statutory Background and Benefits 13.2 Part One (Workers Comp) and Part Two (Employers Liability) 13.3 Premium Basis, Experience Modification, and Classification 13.4 Other States, USL&H, and Federal Acts 13.5 Workers Comp Exclusions and Endorsements
16 National Portion: Other Commercial Lines - BOP, Crime & Marine
14.1 Businessowners Policy (BOP) in Depth 14.2 Crime and Fidelity Coverage 14.3 Inland Marine and Nationwide Marine Definition 14.4 Ocean Marine Coverages (Hull, Cargo, Freight, P&I)
17 National Portion: Other Commercial Lines - Specialty & Professional
15.1 Farm and Agricultural Coverage 15.2 Commercial Umbrella and Excess Liability 15.3 Professional Liability and Errors & Omissions 15.4 Directors & Officers and Employment Practices Liability
18 National Portion: Other Commercial Lines - Surety, Flood & Specialty
16.1 Surety and Fidelity Bonds 16.2 National Flood Insurance Program (NFIP) 16.3 Cyber, Aviation, and Other Specialty Lines
19 National Portion: Insurance Regulation & Market Conduct
17.1 State Regulation, Licensing, and the McCarran-Ferguson Act 17.2 Rates, Forms, Solvency, and Guaranty Associations 17.3 Producer Authority, Fiduciary Duty, and Company Operations
20 National Portion: Ethics & Unfair Trade Practices
18.1 Unfair Trade Practices and Unfair Claims Settlement 18.2 Producer Ethics, Errors & Omissions Exposure, and Fiduciary Conduct 18.3 Privacy, Fraud, and Consumer Protection
21 Chapter 1: Arkansas P&C Insurance Regulation & Licensing
1.1 Arkansas Insurance Department 1.2 Arkansas P&C Producer Licensing Requirements 1.3 Arkansas Producer Responsibilities
22 Chapter 2: Arkansas Property Insurance
2.1 Arkansas Homeowners Insurance 2.2 Arkansas Commercial Property Insurance
23 Chapter 3: Arkansas Casualty & Auto Insurance
3.1 Arkansas Auto Insurance Requirements 3.2 Arkansas Liability Insurance 3.3 Arkansas Workers' Compensation Insurance
24 Chapter 4: Arkansas Ethics & Professional Conduct
4.1 Ethical Practices and Consumer Protection
11.2 Occurrence vs. Claims-Made CGL and Retroactive Dates
Key Takeaways Explain This Topic AI
Occurrence CGL (CG 00 01) responds based on when injury/damage occurs; claims-made CGL (CG 00 02) responds based on when the claim is first made.
Claims-made coverage requires the injury to occur on or after the Retroactive Date - injuries before it are never covered.
Advancing the retroactive date on renewal creates a coverage gap; a sound program keeps the same retro date.
Extended Reporting Periods (tail coverage) come in a free Basic tail (60 days / 5 years) and a purchased Supplemental tail (unlimited reporting), but neither increases limits.
First-year claims-made is the cheapest; pricing steps up each renewal until a mature claims-made premium approaches occurrence pricing.
Last updated: June 2026
Two Coverage Triggers, Two ISO Forms
ISO publishes the CGL in two trigger versions. The choice of trigger determines which policy responds to a loss, and it is one of the most misunderstood - and therefore most tested - concepts on the national exam.
Trigger ISO form Responds when...
Occurrence CG 00 01 The bodily injury or property damage occurs during the policy period - no matter when the claim is later made
Claims-Made CG 00 02 The claim is first made against the insured during the policy period (or extended reporting period), provided the injury occurred on or after the Retroactive Date
The occurrence form ties coverage to the date of injury ; the claims-made form ties coverage to the date the claim is reported.
The Occurrence Trigger and the Long Tail
Under the occurrence form (CG 00 01), the policy in force when the injury or damage took place responds, even if the claim surfaces years later. This is ideal for long-tail exposures - latent disease, slow leaks, construction defect - because a claimant who is injured in 2026 but does not sue until 2032 still draws on the 2026 policy.
Trap: Because the occurrence form must keep responding to old exposures for decades, insurers rely on the General Aggregate and careful reserving. A single 2026 policy could be tapped many years after expiration, which is why occurrence pricing carries more long-term uncertainty than claims-made.
The Claims-Made Trigger and the Retroactive Date
The claims-made form (CG 00 02) responds only if two conditions are met:
The claim is first made during the policy period (or an applicable reporting extension), and
The injury/damage occurred on or after the Retroactive Date (and before the end of the policy period).
The Retroactive Date is the line in the sand - injuries that occurred before it are never covered, no matter when the claim arrives. Advancing (moving forward) the retroactive date on renewal creates a coverage gap and is a classic exam trap; a properly maintained claims-made program keeps the same retroactive date year after year.
Worked Trigger Comparison
A contractor's defective work in 2024 is discovered and a suit is filed in 2027 . Which policy pays?
Occurrence form: the 2024 policy responds (injury occurred in 2024), regardless of the 2027 filing.
Claims-made form: the 2027 policy responds - but only if the retroactive date is 2024 or earlier . If the retroactive date had been advanced to 2025, the claim is barred (injury predates the retro date) and the insured has an uncovered gap.
Tail Coverage: Basic and Supplemental ERPs
When a claims-made policy is cancelled or non-renewed (or the retroactive date is advanced), the insured needs an Extended Reporting Period (ERP) , commonly called tail coverage , to report claims for injuries that occurred during the expired policy's coverage window.
ERP type (CG 00 02) Cost Length
Basic (Mini) Tail Automatic, no charge 60 days for any claim; 5 years for claims arising from injuries reported to the insurer within 60 days of expiration
Supplemental (Full) Tail Purchased, must be requested in writing (typically within 60 days) Unlimited time to report
Trap: Tail coverage does not raise the limits - the supplemental ERP reinstates an aggregate equal to the expiring policy's limit but does not add new capacity beyond it.
Step-Up Pricing and First-Year (Mature) Claims-Made
A brand-new claims-made policy in year one covers only claims made in that single year for injuries on/after the retro date, so it is cheap. Each renewal steps up the price as the exposure window lengthens, until - typically by year five - the policy reaches a mature (fully developed) premium roughly comparable to an occurrence policy. The exam tests that first-year claims-made is the least expensive and that mature claims-made approaches occurrence pricing .
Switching Carriers: Nose Coverage vs. Tail Coverage
When an insured moves from one claims-made carrier to another, there are two ways to bridge the gap created by the prior coverage window:
Tail coverage (ERP) is bought from the expiring insurer to keep reporting old-window claims after the policy ends.
Nose coverage (prior-acts coverage) is obtained from the new insurer by setting the new policy's retroactive date back to the original retro date, so the new policy picks up claims for injuries during the prior period.
Nose coverage is usually cheaper than buying a full tail and avoids a gap, which is why exam questions on carrier changes often steer the insured toward securing prior-acts (nose) coverage rather than a costly supplemental tail.
Why Claims-Made Exists - Pricing Predictability
Claims-made forms emerged to solve the long-tail pricing problem that plagues occurrence coverage in fields like medical malpractice and professional liability, where a claim can surface a decade after the injury. By tying coverage to the reporting date, insurers reserve against claims they can see now rather than guessing about losses that may not appear for years.
Trap: Candidates often assume claims-made is 'worse' coverage. It is not inherently narrower - properly maintained with a stable retroactive date plus tail/nose coverage at transitions, it can mirror occurrence protection while giving the insurer far more rate stability and the insured a lower mature premium in volatile lines.