Short answer
Yes, past claims on RFPs, applications and loss runs often matter long after a file closes. Public RFPs commonly ask whether your firm was a defendant in the last five years, and insurance applications ask about prior claims too. Answer accurately and let defense counsel help word any disclosure. A past claim may affect pricing or eligibility, and no one can promise otherwise.
How past claims on RFPs and applications work
A closed claim file doesn’t disappear. The matter can come up whenever a form asks about your history. The usual question is some version of “Have you had any claims in the last five years?”
A claim also isn’t always a loss. Some files close with no payment, and a few end with the other side owing money. Loss runs show the file, and you may need to explain what it was.
The scenarios below are anonymized composites based on real claim files. Project types and details have been changed.
Four scenarios where a past claim resurfaced
Scenario A: Five years of RFP disclosure
An architect was pulled into a restaurant lawsuit, and it settled with no design defect found. Two county RFPs then asked whether the firm had been a defendant in the last five years. The claims manager said the firm had to disclose it.
Defense counsel wrote a short, neutral statement and billed it to the claim file. Counsel then updated it for the second bid. A neutral, factual statement written by counsel can keep a disclosure consistent across bids.
Scenario B: The reopened subpoena file
A closed file reopened when a second subpoena arrived. The underwriter noticed at renewal and said she would review terms.
Ask your broker to confirm when a file is closed, and close out files promptly. Open files can draw questions at renewal.
Scenario C: Supplemental claim forms
An engineering firm switching carriers had to complete a supplemental claim form before it could bind coverage. Another architect had a prior claim, and the new carrier wouldn’t cover that known matter. It still wanted the details and lessons learned.
Expect a supplemental form if you’ve had a claim. Write up the lessons learned honestly. Prior-acts coverage generally doesn’t extend to a claim you already know about.
Scenario D: A claim that wasn’t a loss
A structural firm’s loss run showed an old HOA claim. That claim ended with the HOA owing the firm money.
A line on a loss run doesn’t tell the whole story. Be ready to explain how the matter ended.
How to prepare your disclosure
- Answer every “last five years” question accurately and completely
- Ask defense counsel to write RFP disclosure language, and reuse it consistently
- Close out files promptly and confirm the closure with your broker
- Keep a copy of your loss runs and review them for errors
- Prepare a short, honest lessons-learned summary before you apply to a new carrier
- Tell your broker about known matters before you switch carriers
Related questions
Do I have to disclose a claim on a public RFP?
When the RFP asks about lawsuits or claims in a set period, firms generally need to answer accurately. In one scenario, the claims manager said disclosure was required. Ask your broker or counsel about the specific question.
What is a loss run?
A loss run is a carrier’s record of your claims, including open and closed files and any payments. Applications often ask for them. Review yours for errors before you submit them.
Will a past claim affect my premium or eligibility?
It may, and no one can promise how a particular carrier will respond. Underwriters generally look at the details, including whether anything was paid. Ask your agent how a prior claim may be viewed.
Will a new carrier cover a claim I already know about?
Generally no. Prior-acts coverage typically doesn’t extend to matters you already know about. The new carrier may still ask for details and lessons learned.
Can a claim end with no loss to the firm?
Yes. In one scenario, a claim ended with the HOA owing the firm money. Loss runs show the file, so be ready to explain the outcome.