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24 William Mitchell Law Review 515 (1998)


The commercial general liability insurance industry shifted, in 1986, from the use of an “occurrence-based” to a “claims-made” policy form. So-called “tail” or “long tail” claims have continued nevertheless, to be asserted under the older “occurrence” policies which required that injury occur during the term of the policy, but not that the claim for such injury be made or brought at any particular time. In seeking state approval to use the new “claims-made” form in 1985-86, the insurance industry represented that the new form would not affect coverage under the old “occurrence” form. Despite that representation, insurers are now asserting, in the guise of an “allocation” claim, that “occurrence coverage” is progressively reduced as each year goes by between the date of the “occurrence” and when the claim is made. This assertion involves a contrived, intricate, and novel interpretation of an ambiguous insurance policy provision, and thus cuts across well-accepted canons of insurance policy interpretation. Such an interpretation would impair coverage that has already attached, and would also impair reasonable expectations on the part of the insured.