I need help on understanding claims-made/occurrence policies.
On the quiz, the following question is given, with the answer in bold being correct.
3
Marks: 1/1
Assume, for each of the following, the insured had calendar year policies: occurrence policies in 2000 and 2001, claims-made policies in 2002 and 2003, both stating retroactive date 1-1-02. The insured retired from business and did not renew or replace the 2003 policy. If there is a BI or PD from a covered occurrence, which policy or policies (if any) apply for; "Claimant injured in 2002. Claim was first made against insured on 7-1-03?"
Choose one answer.
a. The 2002 claims-made policy applies (occurrence after retroactive date, claim first made during its term).
b. All of the policies would apply
c. 2001 occurrence policy applies (occurrence form applies to BI/PD which occurs during the policy term). The 2002 claims-made policy does not apply because the occurrence happened before retroactive date.
d. The occurrence policy would still apply and the 2002 claims-made policy would also apply (with no retroactive date, it applies to claims for all prior occurrences if first made during its term).
Before I looked at the answer choices, I came to the conclusion that the 2003 policy would apply. Wouldn't this be true since the claim was first made against the insured in 2003? I thought in order for the 2002 policy to apply, the claim has to occur and be first made during the policy period. Since the 2002 policy expired before the claim was first made, doesn't the 2003 policy now pick up the claim since there is a retroactive date of 1-1-02?