Discovery of Loss (Crime)

Discovery decides when crime cover is triggered and when notice must be given to the insurer. A loss is 'discovered' once a director, officer, or responsible staff member first learns of facts pointing to a covered loss, no matter how minor those facts may initially seem. This applies no matter when the actual underlying criminal act actually took place. This 'discovery basis' differs sharply from ordinary claims-made cover, and the difference matters a great deal in practice. A crime committed many years ago can still be covered if it happens to be discovered during the current policy period. A loss not discovered until after the policy ends may not be covered by any policy at all. Once discovery happens, the insured must tell the insurer within a set time limit, which is often somewhere between 30 and 60 days. Changing insurers can create a troublesome gap right at the discovery point. The old insurer only covers losses that were discovered while its own policy was still active. The new insurer, in turn, only covers losses that are discovered later on. Knowing how discovery works helps a business manage the switch between insurers and meet every notice deadline it faces.

Discovery decides when crime cover is triggered and when notice must be given to the insurer. A loss is 'discovered' once a director, officer, or responsible staff member first learns of facts pointing to a covered loss, no matter how minor those facts may initially seem. This applies no matter when the actual underlying criminal act actually took place. This 'discovery basis' differs sharply from ordinary claims-made cover, and the difference matters a great deal in practice. A crime committed many years ago can still be covered if it happens to be discovered during the current policy period. A loss not discovered until after the policy ends may not be covered by any policy at all. Once discovery happens, the insured must tell the insurer within a set time limit, which is often somewhere between 30 and 60 days. Changing insurers can create a troublesome gap right at the discovery point. The old insurer only covers losses that were discovered while its own policy was still active. The new insurer, in turn, only covers losses that are discovered later on. Knowing how discovery works helps a business manage the switch between insurers and meet every notice deadline it faces.