Claims-Made Policy

Claims-made policies are less common in tree service general liability but do appear in professional liability, pollution liability, and some excess and surplus (E&S) placements. Under a claims-made form, the policy in effect when the claim is reported is the one that responds — not the policy in effect when the incident occurred. This creates a critical dependency on maintaining continuous, uninterrupted coverage.

For tree service companies, the risk is clear: if you let a claims-made policy lapse and a homeowner files a lawsuit three months later for a tree removal you did last year, you have no coverage. The old policy does not respond because the claim was not filed during its term, and the new policy (if you buy one) may not cover it because the incident predates the new retroactive date.

If you do end up on a claims-made form — sometimes unavoidable for contractors pollution liability — pay close attention to the retroactive date printed on your declarations page. This date determines the earliest incident that the current policy will cover. Each time you renew, confirm the retroactive date has not moved forward, which would create a gap.

When you eventually cancel or non-renew a claims-made policy, you should strongly consider purchasing tail coverage (an extended reporting period endorsement) to keep the reporting window open for claims that have not yet surfaced.