What Is an Occurrence Policy?

Occurrence Policy

What Is an Occurrence Policy?

If your business has any dealings with the public, then you need insurance to cover the myriad circumstances that could go wrong and cause damage or personal injury. However, there are different types of liability coverage. Find out what an occurrence policy covers and when it is used.


In insurance terms, an occurrence is defined as an unforeseen incident that causes harm. It has two main distinctions from the more commonly used word accident. The first is that an occurrence can be an action someone committed intentionally, but with an unexpected, or accidental result. The second is that the occurrence can be an event that happened repeatedly, for example to multiple customers.


Occurrence liability covers damages or injuries that arise during the time the insurance policy is active. For example, if a one-year insurance term begins on January 1, an occurrence policy would help pay for injuries suffered anytime during that year. It doesn’t matter if the claim is not filed until a later date. It also doesn’t matter if the occurrence that caused the damage happened before this window of coverage began.

Most businesses invest in occurrence policies to protect them from unforeseen events that would otherwise cause financial hardship as a result of medical and legal bills.