What is typically included in a claims-made policy?

A claims-made policy is designed to provide coverage for claims reported during the policy's active period, but the key feature that distinguishes it is the specific provision for claims that are filed within a defined period after an incident occurs. This means that the policyholder must make sure that any claim arising from incidents that occurred during the policy period is reported within a certain timeframe, which is usually known as the “reporting period” or “retroactive period.”

This is particularly important because it provides a safety net for policyholders, allowing them to report claims that may not be immediately apparent until after the policy has expired, thus ensuring that they are not left vulnerable to claims that arise from earlier incidents.

In contrast, policies that cover only incidents occurring during the policy period or only claims reported after the policy expires do not address the essential aspect of claims notification within a structured timeframe after an event. Therefore, option C accurately reflects a fundamental characteristic of claims-made policies, emphasizing the requirement for timely notification of claims related to incidents that occurred when the policy was in effect.