An occurrence policy covers injuries or damage that happen during the policy period, no matter when the claim is filed later, while a claims-made policy covers claims first made during the policy period for incidents on or after its retroactive date. Most restaurant general liability is written on an occurrence basis, but employment practices, cyber and some liquor liability policies are commonly claims-made, which makes retro dates and tail coverage important.
Owners rarely look at the trigger on their declarations page until it matters, usually when they switch carriers, sell the business or close a location. This page explains both triggers in restaurant terms so you can spot the traps before a claim shows up in the wrong year.
How each trigger decides which policy pays
On an occurrence form, such as the standard ISO commercial general liability policy, the question is when the injury or damage happened. If a guest was hurt during your 2025 policy term, the 2025 policy responds even if the lawsuit arrives years later and you have long since changed carriers. On a claims-made form, the question is when the claim was first made, and the incident must also fall on or after the retroactive date. Many claims-made policies are also “claims-made and reported,” meaning the claim must be reported to the carrier during the policy period or a short window after it. When a claims-made policy ends without being renewed or replaced with the same retro date, an extended reporting period, often called a tail, lets you report later claims for incidents that happened while you were covered. The ISO claims-made general liability form includes a limited automatic reporting period and an optional supplemental one for an additional premium; EPLI and cyber policies set their own tail options and deadlines for electing them.
Occurrence and claims-made, compared
- What it covers — Occurrence: injury or damage that occurs during the policy period, regardless of when the claim is filed. Claims-made: claims first made (and usually reported) during the policy period for incidents on or after the retroactive date.
- Who needs it — Occurrence: the standard trigger for restaurant general liability, BOP liability, auto and most liquor liability. Claims-made: typical for employment practices liability, cyber, directors and officers, and some liquor liability from specialty bar markets.
- Common restaurant claim example — Occurrence: a guest slips on a spilled drink during the 2025 policy year and sues in 2027 after you changed carriers; the 2025 insurer handles it. Claims-made: a line cook fired in November files a discrimination charge in February, after renewal; the policy in force in February responds, provided the firing came after the retro date.
- How it’s usually bought — Occurrence: most package, BOP and monoline liability policies. Claims-made: EPLI and cyber policies, sometimes as endorsements to a BOP, and certain liquor or umbrella forms; the declarations page will show a retroactive date.
- Common gaps — Occurrence: the limits available are those of the old policy year, so keep old policies on file. Claims-made: gaps when a new carrier advances the retro date, when you close or sell without buying a tail, when you know about a potential claim and fail to report it before expiration, or when a prior-knowledge exclusion applies.
Claims that land in the gap
Selling the restaurant. An owner sells in June and cancels all policies. In September a former server sues over harassment that happened in April. The claims-made EPLI policy has ended and no tail was purchased, so there is no coverage. A guest who slipped in May and sues in October is a different story: the occurrence general liability policy in force in May still responds. Buying or selling a restaurant is the moment to budget for tails.
Switching liquor carriers with a new retro date. A bar moves its claims-made liquor policy to a new carrier that sets the retro date at the new policy’s start. A patron over-served two months before the switch sues after it. The old policy expired without a tail, and the new policy’s retro date excludes the incident, so neither pays. Asking the new carrier to honor the prior retro date, or buying a tail from the old one, closes the gap.
Reporting a potential claim early. A cyber policy is about to expire when your POS vendor warns of suspicious activity but no customer has complained. Most claims-made policies let you give notice of circumstances before expiration, so any later claim from that event attaches to the current policy.
Which trigger should your restaurant choose?
- General liability and liquor liability: prefer occurrence when it is offered on comparable terms, because it keeps covering incidents from that year forever.
- EPLI and cyber: claims-made is nearly universal, so focus on keeping the retro date continuous from carrier to carrier.
- Selling, closing or merging locations: price the extended reporting period before the policy ends, since the election window can be short.
- Keep a simple calendar of each claims-made policy’s retro date and expiration, and report incidents promptly rather than waiting for a lawsuit.
How trigger affects price, and how we shop it
Claims-made premiums often start lower in the first years and step up as the policy matures, because early years carry less accumulated exposure. Tail coverage is priced separately at the end. Occurrence premiums reflect the full exposure from day one. Provident Financial Group is an independent agency, so we compare trigger, retro dates and tail terms across multiple carriers from one application and show them side by side. Certificates of insurance are available once you bind. Call (866) 964-6660.
Frequently asked questions
Is occurrence or claims-made better for a restaurant?
For general and liquor liability, occurrence is usually simpler and safer. For EPLI and cyber, claims-made is standard, and the key is maintaining the retro date.
What is a retroactive date?
It is the earliest date an incident can occur and still be covered by a claims-made policy. Incidents before it are excluded even if the claim arrives during the policy period.
Do I need tail coverage if I close my restaurant?
If any of your policies are claims-made, a tail is how claims reported after closing get covered. Occurrence policies do not need one.
How can I tell whether my policy is claims-made?
The declarations page or form title will say claims-made and will list a retroactive date. You can also look up terms in our insurance glossary.
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