Public Liability Insurance operates on an “Occurrence” basis, which is crucial to understand for policyholders. This means that the insurance will cover claims where the injury or property damage happened during the policy period, regardless of when the claim is actually filed. For instance, let’s consider a scenario: a painter, who is the insured party, was hired to paint the interior of a newly constructed residential property.
In this situation, if a visitor were to slip and fall on freshly painted stairs during the policy period, the Public Liability Insurance would likely cover any resulting injuries or damages. It doesn’t matter if the claim is made weeks or even months later; what matters is that the incident occurred while the policy was in effect. This distinction is crucial for policyholders to comprehend, as it affects when they should report potential claims and how they should understand the scope of their coverage.
Understanding the occurrence basis of Public Liability Insurance is key to knowing when coverage applies. It’s a way to ensure that the insurance policy responds to events that happen during its duration, even if the claim is made much later. So, for individuals and businesses relying on this type of insurance, it’s essential to keep track of when incidents occur, as this determines the coverage that will be provided when a claim is submitted.
(Response: Yes, Public Liability Insurance is occurrence-based, meaning it responds to claims based on when the injury or property damage occurred, regardless of when the claim is filed.)