Commercial insurance has a set term length. This means the coverage has an end date. It is up to the business owner or manager to renew the commercial insurance policy before it expires for timely renewal.
However, there is the possibility of a future claim being filed alleging an event occurred in the past should be covered, long after the policy has expired. In such an instance, is retroactive coverage applicable? Selkirk Insurance Services has the answer.
The Potential for Retroactive Commercial Insurance Coverage
If you own or manage a business in or near Sandpoint, ID, the potential for retroactive commercial insurance coverage might have crossed your mind at one point or another. Retroactive is a word that refers to the past. In the context of business, there is the possibility of retroactive coverage for commercial policies after policies have ended. However, if the claim is filed after the specified retroactive date, the policy does not provide benefits.
Each individual commercial insurance policy has its own specific retroactive coverage date to minimize the insurer’s financial liability moving forward. The logic in such an approach is that insurers would face significant financial losses in the event that claims were allowed to be filed retroactively across posterity. Moreover, claims filed pertaining to incidents that occurred prior to the policy start date will not be covered as retroactive coverage is not effective prior to the start of the commercial insurance policy.
Sweat the Small Stuff of Your Commercial Insurance Policy
Before obtaining a new commercial insurance policy, take a close look at the language detailing the retroactive coverage date. The language might note that gaps in coverage, late payments and/or missed payments nullify retroactive coverage.
However, if there are no such gaps, there’s a chance the retroactive coverage will date back several years into the past.
Selkirk Insurance Services Is at Your Service
Are you considering opening a new business in or near Sandpoint, ID? If you are a budding entrepreneur or own a business, contact us for an insurance quote. Give us a call today for more information about our business insurance coverage options.
