Which type of policy is commonly described as a claims made policy?

A claims-made policy is designed to provide coverage for claims that are made during the policy period, regardless of when the event that led to the claim occurred, as long as it falls within the period stated in the policy. This type of policy is particularly common in certain areas of insurance where the timing of the claims might not coincide with the time of the actual event, such as in professional liability or commercial liability insurance.

These policies require the insured to have coverage in force both when the incident occurred and when the claim is made, creating a necessary overlap in coverage. This structure offers a strong incentive for professionals to maintain continuous coverage, as gaps in policy periods could leave them unprotected against claims made after a previous policy has expired.

This contrasts with other types of policies, such as health or automobile insurance, which tend to operate on an occurrence basis, meaning coverage is triggered by events occurring during the policy period, regardless of when the claims are made. Similarly, property insurance typically covers damages or losses that occur to property during the policy period but does not fit the claims-made structure. Therefore, the nature of some commercial and professional liability policies aligns with the characteristics of claims-made policies, making them the correct answer in this context.