Read one real story from my broker’s practice:

Alex came to me scared to death. AllState insurance company was after him about a claim for burned house. Why were they after him? The owner of this burned home gave to AllState Alex’s information as a person who did remodeling to their kitchen almost 10 years befor!. The dishwasher was where the fire started, so AllState was after the remodeling company - in our case Alex’s company.

Alex shared to me that he doesn’t remember working for these people, but he probably left an estimate with them when offering his services.

With my agency, he had insurance before, but he didn’t renew and was working without insurance for a year already.  With this potential claim information he shared with me, I had almost no market to place his new General Liability insurance.

He found insurance only with difficulty, and now doesn’t allow any gap in coverage. If a claim arises, he should be responsible for any period of time, when his business was left without coverage: from the time a project is done till the time of claim arising from this particular project.

Recapitulation:

• A claim might appear after many years.
• Your coverage during all these years will pay proportionally.
• If there is a gap, you/your business is responsible for the compensation.

Alex’s story has not ended yet. AllState obviously didn’t have any particular documentation to follow further, but he received his lesson for life and many sleepless nights as an extra.