Occurrence-basis liability coverage in Canada: how response is tied to when injury or damage occurred.
Occurrence basis is liability coverage that generally responds based on when bodily injury or property damage occurred, even if the claim is made later.
This concept helps readers understand why older liability policies can still matter after the policy term has ended. The key question is often when the injury or damage happened, not just when the lawsuit or demand arrived.
Occurrence-basis language is common in Canadian commercial general liability policies. The insurer usually examines:
This is the main contrast to claims-made coverage, where the timing of the claim itself is central.
| Trigger structure | Main timing question |
|---|---|
| Occurrence basis | When did the bodily injury or property damage occur? |
| Claims-made coverage | When was the claim first made and reported, and does any retroactive date apply? |
A slip-and-fall injury happens during last year’s CGL policy period, but the injured party sues this year. The policy that was in force when the injury occurred may be the one that responds, subject to the wording.
That is why liability claims teams often need old CGL policies when a demand arrives years later. The current broker or insured may be focused on today’s program, but the legally relevant policy year may be the one in force when the injury or damage first happened.
Occurrence basis is not the same as claims-made coverage. A later claim can still point back to the earlier policy period if the injury or damage happened then.
It is also wrong to assume every business liability form uses occurrence logic. Professional and specialty lines often use different timing structures.
Progressive damage, long-tail claims, and disputed injury timing can make occurrence analysis more technical than the short label suggests. Readers should pay close attention to how the policy defines bodily injury, property damage, and occurrence.