14 Onstream handler to ensure the proper policies and policy periods are invoked. Invoking other policy conditions: Notice of Circumstance and Loss Notification Options Other policy provisions in claims-made policies which may impact the policy period invoked are the Notice of Circumstance and Loss Notification Option, or similar wording. The Notice of Circumstance provision allows for the insured to notify Underwriters of an occurrence which is likely to result in a claim but for which no claim has yet been made. If invoked, that policy would then provide coverage for all claims later brought against the insured (usually for some designated period following provision of notice of the Circumstance to Underwriters). The Notice of Circumstance provision can be invoked on any policy period, not just the one in effect at the time of the occurrence, so long as an actual ‘claim’ has not yet been made against the insured. In addition, claims-made forms may allow an insured to exercise a Loss Notification Option, notifying a loss to a policy during its period for the purpose of having any additional claims later arising from the same loss covered under the noticed policy. Once invoked, that policy would then provide coverage for all claims arising for a certain period of time, regardless whether such claims actually fell under a later policy period. Loss Notification Options require that the Loss being notified be one for which a claim has already been made, in writing, against the insured, and one which had not previously been notified as a Circumstance. Correspondence from an insured advising of a loss should be carefully reviewed to determine whether either policy option is invoked, as no ‘magic language’ is required to trigger the coverage afforded, and, once again, identification of the proper policy period impacted by a loss is key. What the insured or broker says about which policy is being noticed should be taken with a ‘grain of salt,’ as the policy terms and facts dictate which is invoked, not necessarily their intentions. Notifying the insurer: reporting requirements and notice issues Notice issues arise under both claims-made and occurrence policies. The majority of policies require notice of a loss to be provided within a reasonable time or as soon as practicable. Nevertheless, most jurisdictions will not allow an insurer to avoid coverage as a result of late notice, unless it can show it was prejudiced by the delayed reporting. This assumes the policy wording does not disclaim late notice as a defense by stating late notice does not prejudice underwriters. Unlike occurrence policies, however, some claims-made policies, known as ‘claims-made-and-reported’ policies, additionally require the claim be reported to the insurer within the policy period or within a specific period of time thereafter. Courts have recognized the express requirement that the claim be made and reported to the insurer during the © 2013 Xchanging