A claims-made PI policy responds to claims first made against the insured during the policy period. An occurrence PI policy responds to claims arising from acts that occurred during the policy period, whenever the claim is made. The two cover triggers behave very differently at renewal, on insurer change, and after a firm ceases trading. Almost all UK professional indemnity is written on a claims-made basis.
What claims-made vs occurrence means in PI insurance
The cover trigger is the test the policy uses to decide which year’s policy responds to a given claim. There are two main triggers in long-tail liability insurance:
Claims-made. The policy that responds is the one in force when the claim is first made against the insured (or when a circumstance is first notified). The work giving rise to the claim could have been done years earlier. The retroactive date on the policy bounds how far back the original work could have been performed and still be covered.
Occurrence. The policy that responds is the one in force when the act, error, omission or injury actually occurred. The claim may be made decades later, but it attaches to the policy that was in force at the time of the underlying act.
For PI, the UK market has settled overwhelmingly on the claims-made basis. The reason is essentially actuarial. Occurrence policies create open-ended liability for the insurer that extends decades after the policy year ends, and pricing that risk reliably for advisory and design work is difficult. Claims-made policies fix the insurer’s exposure to claims notified within the policy year, which makes the cover priceable and renewable.
A consequence is that PI cover does not “follow” the work in the way occurrence cover would. The cover is portable between policy years, but only if continuously renewed. Lapse the policy and the cover for past work stops.
How claims-made cover works in practice
Several practical features follow from the claims-made trigger:
- Continuous cover is essential. A gap in PI cover means the gap year is uninsured against any claim notified in that period, including for old work. A firm that lapses cover for even a week may find an old-work claim in that window uninsured.
- Notification timing controls which year responds. A claim notified in May 2026 attaches to the 2026 policy, even if the underlying advice was given in 2018. The 2018 policy does not respond to the 2026 notification.
- Retroactive date bounds the look-back. See retroactive date PI. The policy will not respond to work done before the retroactive date, no matter how the claim is framed.
- Circumstance notifications are a key tool. A firm that becomes aware of a circumstance that may give rise to a claim can notify it during the current policy year, attaching potential future claims to that year’s cover. See circumstance notification. This protects against a future renewal change altering the cover position.
- Run-off cover is needed when the firm ceases. A firm that stops trading has no future working policy to notify into, so run-off cover must be bought to bridge the tail. See run-off cover PI.
- Switching insurer needs careful retroactive date handling. A new claims-made policy must carry a retroactive date at least as broad as the previous policy’s, or some past work falls outside cover.
By contrast, an occurrence policy — rare in UK PI but common in some general liability lines — would:
- Respond to claims arising from acts in its policy year regardless of when the claim is made.
- Not need a retroactive date, because the policy year itself defines the covered period.
- Not need run-off cover, because each year’s policy continues to respond to its own year’s acts forever.
- Not require continuous renewal to preserve cover for past acts.
Worked example: how the two triggers behave on the same facts
Consider a UK consultancy giving advice in March 2022. The advice turns out to be defective, and the client notifies a £450,000 claim against the firm in November 2026 — four and a half years later. The firm has bought PI cover continuously since starting practice in 2018.
Under a claims-made policy (the UK PI norm):
- The 2026 policy is the one that responds, because that is when the claim was first made.
- The 2026 policy’s limit, excess, defence costs treatment and retroactive date all apply.
- If the firm has £1m each-and-every cover with £2,500 excess and defence costs outside, the 2026 policy pays the £450,000 settlement, the firm pays £2,500 excess, and defence costs sit on top.
- The 2022 policy (when the advice was given) plays no role.
- If the firm had lapsed cover at any point between March 2022 and November 2026, the November 2026 claim would meet no policy and be uninsured.
Under an occurrence policy (hypothetical for UK PI):
- The 2022 policy would respond, because that is when the act occurred.
- The 2022 policy’s terms — its limit, its excess, its defence-costs treatment — would govern, even though those terms may no longer be the firm’s current cover.
- The 2026 policy plays no role.
- Whether the firm still exists or has bought cover in subsequent years is largely irrelevant; the 2022 policy is what responds.
The structural implications matter to firms making decisions about renewals, run-off, and continuity of cover. In the UK PI market the question is almost always “is my current claims-made policy strong enough, with a wide enough retroactive date, and continuous from inception” — because that is the policy that will respond when a claim comes.
When this matters most
The claims-made vs occurrence distinction matters most:
At every renewal. Continuity of cover is the precondition for protection of past work. Any gap exposes the firm to uninsured old-work claims arising in the gap.
When changing insurer. The retroactive date on the new policy needs to be checked. A more restrictive retroactive date leaves part of the working history uninsured.
On ceasing practice. Run-off cover must be arranged. Without it, future claims arising from historic work have no policy to attach to.
On takeovers and restructures. Where one entity’s identity is dissolved into another, the claims-made cover does not automatically transfer. Either the acquirer’s policy is broadened or run-off is arranged for the original entity.
When deciding whether to notify a circumstance. A circumstance notification in the current policy year attaches potential future claims to that year’s cover, even if the claim itself does not crystallise until a later year. This can be valuable if the current cover terms are particularly favourable.
For long-tail professions. Construction, advice on long-life products, design work — anywhere the gap between the act and the claim can be many years — the claims-made structure puts pressure on continuous cover and on a long retroactive date.
Common variations and market wording
The “claims-made” trigger itself comes in a few variants:
- Pure claims-made. The policy responds to claims first made against the insured during the policy period. Most UK PI follows this approach.
- Claims-made and reported. A stricter variant: the claim must be both first made against the insured and reported to the insurer during the policy period. Some wordings use this language; it is more restrictive than pure claims-made and reduces flexibility on late reporting.
- Discovery basis. Used in some financial lines, this trigger fires on the insured’s discovery of a loss. Not standard in UK PI but occasionally seen in adjacent covers like crime or fidelity.
- Continuous cover provision. Some PI policies include a clause that protects the insured where a circumstance should have been notified in an earlier year but was not, provided cover has been continuously held with the same insurer. The clause varies materially between wordings; not all policies include it.
Occurrence cover in PI exists in a few specific contexts:
- Some legacy or specialist wordings outside the standard market.
- Some non-UK jurisdictions where occurrence is more common (in particular, certain US states for specific professions).
- General liability sections of combined policies, where the public liability part may be occurrence-based even though the PI section is claims-made.
For UK regulated PI the practical assumption should be: the cover is claims-made unless the schedule says otherwise.
Related concepts
- Retroactive date — the earliest date covered by a claims-made policy.
- Run-off cover — bridges the gap after cessation.
- Circumstance notification — how to attach future claims to the current policy year.
- Policy period — the window during which a claim must be made for the policy to respond.
Frequently asked questions
Is UK PI claims-made or occurrence?
UK professional indemnity is almost universally written on a claims-made basis. The policy in force when the claim is first made against the insured is the one that responds, regardless of when the underlying work was done. Occurrence PI exists in a few specialist contexts but is not the market norm. Schedules should be read to confirm, but for any standard UK PI policy the assumption is claims-made.
Why is claims-made the standard for PI?
PI claims often arise years after the underlying work — advice given in 2018 may not trigger a claim until 2026 or later. Occurrence cover would leave the insurer liable for unknown future claims arising from any policy year forever, which is hard to price reliably. Claims-made cover fixes the insurer’s exposure to claims notified during the policy year, which keeps the cover priceable and renewable.
What happens if I lapse my PI cover?
A lapse breaks continuous cover. Any claim notified during the lapse period attaches to no policy and is uninsured, even if the underlying work was done while the firm was previously insured. When fresh cover is arranged later, the retroactive date on the new policy may or may not bridge the gap. Lapses are one of the most damaging things a claims-made-insured firm can do.
Does claims-made cover claims I do not know about yet?
Yes — that is its point. The policy responds to claims first made against the insured during the policy period, regardless of when the underlying act occurred (provided the act was on or after the retroactive date). A firm with continuous claims-made cover and a long retroactive date is protected against latent claims that have not yet surfaced, so long as the cover continues to be renewed.
Does claims-made cover defence of regulatory action?
Whether regulatory defence costs are covered depends on the policy wording, not on the claims-made trigger itself. Many PI policies include a regulatory defence costs extension, typically as a sub-limit. The extension responds to defence of regulatory proceedings notified during the policy year, on the same claims-made basis as the main cover.
Can I move from claims-made to occurrence cover?
In UK PI this is rarely a practical option. The market does not offer occurrence cover as a routine alternative for most professions. Switching to a notional occurrence policy would create coverage gaps for past work performed under claims-made cover, because the claims-made policy stops responding to claims first made after its expiry. For most firms the right answer is to maintain claims-made cover continuously and arrange run-off when ceasing.
What is a circumstance notification?
A circumstance is a fact or event that may give rise to a claim. Most claims-made PI wordings let the insured notify a circumstance during the policy year, attaching any future claim arising from that circumstance to the current year’s policy. This is a key protection because it locks in the current policy’s terms even if the claim itself does not materialise until later. See circumstance notification.
Does claims-made cover transfer if I sell my practice?
Not automatically. The claims-made policy is the named insured’s policy. On sale, the cover is usually addressed in one of three ways: the buyer’s policy is extended to cover the acquired firm’s past work (with a suitably extended retroactive date), the seller arranges run-off cover for the historic exposure, or a combination of both. Brokers and lawyers should plan this before completion, not after.
{
"@context": "https://schema.org",
"@type": "Article",
"headline": "Claims-made vs occurrence PI: what the difference actually means",
"description": "Claims-made cover responds to claims first made in the policy year; occurrence cover responds to acts in the policy year. UK PI is almost universally claims-made.",
"author": {
"@type": "Organization",
"name": "Apex Insurance Brokers Ltd",
"url": "https://www.apexinsurancebrokers.co.uk/"
},
"publisher": {
"@type": "Organization",
"name": "Apex Insurance Brokers Ltd"
},
"datePublished": "2026-05-29",
"dateModified": "2026-05-29",
"inLanguage": "en-GB"
}
{
"@context": "https://schema.org",
"@type": "DefinedTerm",
"name": "Claims-made vs occurrence (PI insurance)",
"description": "Two policy triggers that determine which year's policy responds to a claim. Claims-made cover responds to claims first made against the insured during the policy period. Occurrence cover responds to acts that occurred during the policy period. UK professional indemnity is almost universally claims-made.",
"inDefinedTermSet": {
"@type": "DefinedTermSet",
"name": "Apex Insurance Brokers Glossary",
"url": "https://www.apexinsurancebrokers.co.uk/glossary/"
}
}
{
"@context": "https://schema.org",
"@type": "FAQPage",
"mainEntity": [
{
"@type": "Question",
"name": "Is UK PI claims-made or occurrence?",
"acceptedAnswer": {
"@type": "Answer",
"text": "UK professional indemnity is almost universally claims-made. The policy in force when the claim is first made against the insured is the one that responds, regardless of when the underlying work was done. Occurrence PI exists in a few specialist contexts but is not the market norm."
}
},
{
"@type": "Question",
"name": "Why is claims-made the standard for PI?",
"acceptedAnswer": {
"@type": "Answer",
"text": "PI claims often arise years after the work. Occurrence cover would leave the insurer liable for unknown future claims forever, which is hard to price. Claims-made fixes the insurer's exposure to claims notified during the policy year, keeping the cover priceable and renewable."
}
},
{
"@type": "Question",
"name": "What happens if I lapse my PI cover?",
"acceptedAnswer": {
"@type": "Answer",
"text": "A lapse breaks continuous cover. Any claim notified during the lapse attaches to no policy and is uninsured, even if the underlying work predates the lapse. Fresh cover later may carry a restricted retroactive date that does not fill the gap."
}
},
{
"@type": "Question",
"name": "Does claims-made cover claims I do not know about yet?",
"acceptedAnswer": {
"@type": "Answer",
"text": "Yes. The policy responds to claims first made during the policy period regardless of when the act occurred, provided the act was on or after the retroactive date. Continuous claims-made cover with a long retroactive date protects against latent claims that have not yet surfaced."
}
},
{
"@type": "Question",
"name": "Does claims-made cover defence of regulatory action?",
"acceptedAnswer": {
"@type": "Answer",
"text": "Whether regulatory defence costs are covered depends on the wording, not on the claims-made trigger. Many PI policies include a regulatory defence costs extension as a sub-limit, responding on the same claims-made basis to proceedings notified during the policy year."
}
},
{
"@type": "Question",
"name": "Can I move from claims-made to occurrence cover?",
"acceptedAnswer": {
"@type": "Answer",
"text": "Rarely practical in UK PI. The market does not routinely offer occurrence cover for most professions. Switching would create gaps for past work performed under claims-made cover. The right answer is usually continuous claims-made cover plus run-off on cessation."
}
},
{
"@type": "Question",
"name": "What is a circumstance notification?",
"acceptedAnswer": {
"@type": "Answer",
"text": "A circumstance is a fact or event that may give rise to a claim. Most claims-made PI lets the insured notify a circumstance during the policy year, attaching any future claim arising from it to the current year's policy. This locks in current policy terms."
}
},
{
"@type": "Question",
"name": "Does claims-made cover transfer if I sell my practice?",
"acceptedAnswer": {
"@type": "Answer",
"text": "Not automatically. Options are extending the buyer's policy to cover the acquired firm's past work, the seller arranging run-off, or a combination. The transfer of historic PI exposure should be planned before completion, not handled afterwards."
}
}
]
}
About Apex Insurance Brokers Ltd
Apex Insurance Brokers Ltd is a Bristol-based insurance broker authorised and regulated by the Financial Conduct Authority (firm reference number 724952). The company is registered in England and Wales under Companies House number 07014570. Contact: info@apexinsurancebrokers.co.uk | 0117 325 0027.
Last reviewed: May 2026 by Apex Insurance Brokers Ltd.
Important: this article is general information, not advice on your specific circumstances. For advice on PI insurance for your firm, contact us on 0117 325 0027 or info@apexinsurancebrokers.co.uk.