Which statement about occurrence-based liability policies is incorrect?

Occurrence-based liability policies are designed to provide coverage for events that cause injury or damage during the policy period, regardless of when a claim is filed. The key aspect of these policies is that the insurance coverage is tied to the time of the occurrence, rather than the time when a claim is made.

The statement regarding the maximum insurance amount applying to all occurrences is the incorrect one in the context of occurrence-based liability policies. Instead, these policies typically allow for a separate limit of insurance for each occurrence. This means that if multiple incidents occur within the policy period, each incident can trigger its own limit of coverage, rather than a single maximum amount that must cover all claims combined.

This distinction is essential to understand because it clarifies how occurrence-based policies work, particularly in providing broader protection to policyholders by ensuring each occurrence they are liable for has its own dedicated limit. The other statements about these policies accurately reflect how they operate, such as covering bodily injury from accidents and damages resulting from long-term exposure to harmful conditions, reflecting their comprehensive nature in addressing various liabilities.