Think twice before signing up for one of those "claims-made" liability policies that insurance companies are pushing so aggressively. These are the policies that provide coverage only for claims made during the time the policy is in effect. In contrast, a traditional "occurrence" policy protects you even if the claim is made years after the policy has been terminated.

Claims-made policies have one major selling point: they start out cheaper than occurrence policies. Eventually, the premiums rise to comparable levels, but by then you're locked in. That's where the danger lies. If, at that point, you decide to switch to an occurrence policy or other insurance alternative, you won't be covered for claims dating back to the claims-made period -- unless, that is, you have a "tail" policy, which may cost up to 200% of your annual premium.