Los Angeles Claims Adjuster Property and Causality Practice Exam

What is the Basic Extended Reporting Period in a CGL policy?

1. A period for reporting claims after policy expiration

2. An additional premium for extra coverage

3. A period during which no claims can be reported

4. A discount on the premium for timely reporting

The correct answer is: A period for reporting claims after policy expiration

The Basic Extended Reporting Period (BERP) in a Commercial General Liability (CGL) policy is a specified time frame during which the insured can report claims that arise from incidents occurring while the policy was still in effect, even after the policy has expired. This provision allows claimants to have a window to file claims without the pressure of the policy term. It’s particularly important because it provides continuity of coverage for claims that may take time to develop or be discovered after the policy has ended. In contrast to the other options, the Basic Extended Reporting Period does not involve an additional premium for coverage, nor does it restrict the ability to report claims. It offers valuable protection by ensuring that the insured is still covered for incidents that occurred during the active policy period, even after that period has concluded. Additionally, it does not provide discounts based on reporting efficiencies but instead extends the opportunity to report claims. This ensures that the insured has a fair chance to manage and resolve claims that might come up after their initial coverage window has closed.