Prior Acts Coverage 

Prior Acts Coverage is an important term to understand when it comes to insurance policies. It refers to coverage for claims that arise from incidents that occurred before the effective date of the current policy. In simple terms, it provides protection for past events that were unknown or unreported at the time the policy was purchased. Let’s say you are a professional consultant, and you decide to change insurance providers. If you opt for a new policy without Prior Acts Coverage, any claims that arise from work you did in the past would not be covered. On the other hand, if you have Prior Acts Coverage, your new policy would extend coverage to these prior incidents, as long as the claims are made during the policy period. This is particularly important for professionals who work in fields where claims can take years to surface, like architects or engineers. Prior Acts Coverage ensures that you are protected from potential legal liabilities that may arise from past actions, even when you switch insurers. It is crucial to carefully consider whether to include this coverage in your policy, as it provides an added layer of security and peace of mind. However, it is also important to note that Prior Acts Coverage can have limitations, such as exclusions for known incidents or specific periods of time. Therefore, it is essential to review the terms and conditions of your policy to fully understand the extent of your coverage.