Question

The retroactive date in a claims-made general liability policy is?

1) the inception date of the policy
2) the last date a claim may be filed and covered by the policy
3) the first date that an event may occur and be covered by the policy
4) the policy expiration date

Answer 1

The retroactive date in a claims-made general liability policy is the date from which the policy will cover claims for incidents that happened prior to the policy's effective date.

Step-by-step explanation:

In a claims-made general liability policy, the retroactive date is the date from which the policy will cover claims for incidents that happened prior to the policy's effective date. This means that if an incident occurred before the retroactive date, but a claim is made after the policy's effective date, the policy will cover it.

For example, let's say a business purchases a claims-made general liability policy with a retroactive date of January 1, 2022, and an effective date of January 1, 2023. If a customer sues the business for an incident that occurred in December 2022, the policy will cover the claim, even though the incident pre-dates the policy's effective date.

The retroactive date is important because it helps determine whether a claim is covered by the policy or not. Claims that arise from incidents that occurred before the retroactive date may not be covered.