What is a Retroactive Date?
The retroactive date is usually the first date of uninterrupted claims made coverage with any carrier. The retroactive date on your policy means that the company will cover any reported claims/incidents which occur between the retroactive date through the effective date of the policy. The retroactive date can be found on the declarations page.
The retroactive date shown on the policy is the date after which any errors or omissions of the Insured are covered. Any errors or omissions made before the retroactive date are excluded by the policy. The retroactive date may be the time that the Insured first purchased a Professional Indemnity or Directors’ & Officers’ Liability policy. It is important to make sure that the retroactive date is correct. Remember, as shown in Question 3 above, that the actual event that causes a claim to be made under the policy may have occurred in a prior period of insurance, but is only covered if it is notified to the Insurers in the period of insurance when the Insured first becomes aware of the claim or circumstances. The act, error or omission must arise from work done after the retroactive date shown in the schedule of the policy for the insurance to respond.
A retroactive date simply defined is an exclusion for any claims occurring prior to a specified date listed in the policy declarations. The policy will not cover any claim for injury or damage prior to this date, even though the claim is made during this policy period. It is recommended that the retroactive date be left as originally stated on the first “claims made” policy. The second policy will then cover not only claims made during this second policy period, but under the first policy period as well. By leaving this original date in place, each subsequent renewal policy will provide more coverage than the first. Over a period of time, the program will mature and eventually no claims will be excluded by the retroactive date. If this date is moved forward, on renewal a coverage gap could be created. This date is also used to prevent duplicate coverage when an “occurrence” policy is changed to a “claims made” policy.
Related Questions
- Will an agency be required to submit retroactive certified payroll records if they started ARRA funded work prior to receiving the DOL wage determinations?
- Can a student petition for a retroactive withdrawal for an entire semester under serious and extenuating circumstances?
- What are Foreign Language retroactive credits? Am I eligible to receive retroactive credits?
