Unlike most other forms of professional liability insurance,media liability insurance is typically written on an occurrencerather than a claims-made basis.

In other words, the policies cover claims arising out of“occurrences” during the policy period, regardless of when theclaim is made or suit is brought.

An “occurrence” is typically defined as the first publication ofa particular piece of content, such as a book, film ormagazine–sometimes referred to as “matter.” Thus, as long as thematter covered by the policy is first published during the policyperiod, the insured will have an eternity of coverage for claimsarising out of that matter.

The reason underwriters have been comfortable writing medialiability coverage on an occurrence basis is important tounderstand.

Historically, the principal cause of action covered by a mediainsurance policy was defamation, also known as libel and slander.Indeed, originally media liability insurance was also called “libelinsurance.”

Defamation claims are governed by notoriously short statutes oflimitations, usually one-to-three years from the date of firstpublication, regardless of when the plaintiff first learned of thepublication. Moreover, under the “single publication rule,”subsequent publications of the same content “relate back” to theoriginal publication and the statute of limitations begins to runat that time.

Thus, insurers know that they can write media coverage on anoccurrence basis without fear of a “long tail.” Despite the factthat media liability policies have expanded over the years to covera wide range of claims in addition to libel and slander–some ofwhich may have longer statutes of limitation–most media liabilityunderwriters continue to offer the coverage on an occurrence basisfor most classes of business.

The tremendous value of the occurrence policy should not beoverlooked. Consider a media liability policy written for aspecific book or film–what is typically referred to as“project-specific E&O.” As long as the book or film is firstdisseminated during the policy period, coverage will “attach” atthat time. In most cases, of course, the book or film will remainin circulation long after the policy period expires.

With an occurrence form, there is no need to renew the policy tomaintain coverage. Coverage has attached, and will follow that bookor film like a bad penny throughout its circulation lifespan. If aclaim is brought against the insured two, three, five, or even 10years later arising out of that same book or film, the originaloccurrence policy will respond.

Of course, if the content changes–such as outtakes or interviewsadded to a DVD, or a new edition of a book with added content–theunderwriter will need to review the new material, charge whateveradditional premium may be appropriate, and either endorse coverageonto the original policy or issue a new one. But as long as thecontent is unchanged, the original policy will respond.

If the policy had been written on a claims-made basis, on theother hand, the insured would have to continually renew the policyin order to maintain coverage.

“Gone With The Wind,” for example, was first published in 1936and remains in circulation today. Imagine the burden on theoriginal publisher and author and their successors and estates–notto mention their insurance agents–if they had to renew the originalpublisher's liability policy for the next 70 years to maintainin-force coverage.

To be sure, it is unlikely that a claim would be brought 70years after original publication. But media law can be tricky. Itis not unheard of for claims to be asserted long after the firstpublication of the original work, particularly with respect tocopyright and other intellectual property disputes.

A great example is the case of MGM vs. McClory. MGM is theproducer and distributor of James Bond films, having acquired therights from Ian Fleming, who created the Bond character in his spynovels. The first Bond film, “Dr. No,” was released in 1962. Morethan 35 years later, Kevin McClory alleged that he owned rights tothe Bond character based on his alleged collaboration on theoriginal “Thunderball” screenplay in the late 1950s.

MGM ultimately prevailed in the lawsuit, but only after years oflitigation and legal expenses that literally ran in the multiplemillions of dollars.

Despite the advantages, the value of the occurrence policy seemsoccasionally to be overlooked in the marketplace. Some customersand agents continue to purchase claims-made offerings despite theavailability of comparably priced occurrence coverage, even thoughthe occurrence form is indisputably a superior value.

Occasionally, they will request a three-year claims-made policy,apparently on the theory that the three-year term will compensatefor the difference in triggers.

Of course, the difference between a three-year claims-made formand an occurrence policy is the difference between three years andinfinity.