Occurrence basis (insurance trigger)

Occurrence basis is an insurance policy trigger structure where coverage applies based on when the underlying incident occurred, not on when the claim is later lodged. It is the standard trigger for public liability and products liability insurance in Australia. A 2026 occurrence-basis public-liability policy will respond to a 2026 incident even if the claim arrives in 2028 or 2030, provided the policy was in force at the date of the incident.

The contrast with claims-made:

Policy structure	When does the policy respond?	Standard use
Occurrence basis (this)	Date of the underlying incident	Public liability, products liability
Claims-made basis	Date the claim is lodged with the insurer	Professional indemnity, D&O

The contrast matters for builders running long-tail risk:

Occurrence example (public liability):

Builder holds public liability 2024-2025.
A wall collapses during construction in 2025, injuring a neighbour.
Builder lets the policy lapse in 2026.
The neighbour sues in 2028.
The 2024-2025 policy still responds because the incident occurred while it was in force.

Claims-made example (PI):

Builder holds PI 2024-2025.
Design defect emerges from 2024 work.
Builder lets policy lapse in 2026.
Claim lodged in 2028.
No policy responds because PI is claims-made and no claim was in force on the date the claim was made. The builder is personally exposed (this is why run-off cover exists for PI).

Why builders should know which trigger applies:

Public liability: occurrence. Lapsed policy still covers old incidents.
Products liability: occurrence. Old defective products covered by the policy in force at the time.
Workers compensation: occurrence-like (the injury date triggers; statutory scheme).
Professional indemnity: claims-made (need current policy or run-off cover).
Management liability / D&O: typically claims-made.

For long-tail liability (e.g. wall collapses 5 years post-completion), occurrence-basis is the friendly trigger; claims-made is the dangerous one.

Renewal-time check:

A builder considering letting public liability lapse before retirement should remember that:

The lapse is fine for incidents that have not yet occurred (no future incidents covered).
Past incidents (occurrence before lapse) remain covered.
Insurance brokers will sometimes try to upsell ongoing cover; for occurrence-basis policies, the past-incident cover is automatic.

Also known as: event basis; incident basis; accident basis.

Category: Insurance.

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