Open Claim
Written by Justin Goodman, CIC, CISC, CLCS, CEO and Co-Founder, Total CSR
Published: October 2, 2026 · Last reviewed: October 2, 2026
In plain language: An open claim is any claim that has been filed with an insurance company but has not yet been fully paid, denied, or closed out. The insurer is still investigating, negotiating, or waiting on repairs, medical treatment, or legal resolution.
Technical definition: An open claim is a claim file that carries an active reserve on a carrier's books because liability, damages, or both remain undetermined. It stays open through investigation, litigation, or ongoing treatment until the insurer issues final payment, a denial, or a closing reserve adjustment.
Open Claim at a Glance
| Attribute | Detail |
|---|---|
| Also known as | Pending claim, active claim |
| Category | Claims handling and policy administration |
| Lines of business | Commercial Property, CGL, Personal Auto, Homeowners, Workers Compensation |
| Industries most affected | Construction, Real Estate, Trucking, Hospitality, Habitational |
| Who bears the risk | Policyholder (premium impact), carrier (reserve exposure) |
| Common solution | Regular claim status reviews and proactive reserve diligence |
| Also interacts with | Loss runs, experience modification calculations, renewal underwriting |
Key Takeaways
- An open claim is a filed claim that has not reached final payment, denial, or closure, and it still carries an active reserve on the insurer's books.
- Open claims directly affect loss runs, experience modification factors, and renewal pricing, so agencies must track them closely for every commercial account.
- A common misunderstanding is assuming an open claim with a large reserve will cost that full amount; reserves are estimates, not final payouts, and many close for less.
- Agencies build trust and reduce E&O exposure by requesting updated loss runs before renewal and flagging stale open claims to the carrier for review.
What Is Open Claim in Insurance?
Open claim describes the status of a claim file from the moment it is reported until the insurer formally resolves it. Carriers keep a claim open because liability is still being investigated, medical treatment is ongoing, repair estimates are incomplete, or litigation is pending. The claim remains on the insurer's books with a reserve, which is a dollar estimate set aside to cover the eventual payout.
The open status exists because insurance accounting requires carriers to show anticipated liabilities even before a final number is known. State insurance regulators require reserving practices so that insurers remain solvent enough to pay claims as they develop. Without reserves tied to open claims, a carrier's financial statements would understate its true obligations.
Consider a commercial auto claim where a company driver rear-ends another vehicle. The claim opens the day it is reported, the carrier sets an initial reserve based on early estimates, and the file stays open while the other driver completes medical treatment. Eighteen months later, once treatment ends and a settlement is reached, the carrier closes the claim and records the final paid amount, which may be higher or lower than the original reserve.
Total CSR's training work with agency teams consistently finds that CSRs misread an open claim's reserve as a locked-in cost, when in practice the reserve is a moving target that adjusters revise as new facts emerge.
How Does Open Claim Work?
- The report. A policyholder or claimant notifies the carrier of a loss, and a claim number is assigned, creating the claim file.
- The reserve. The adjuster sets an initial reserve, an estimated dollar amount for expected damages, based on early facts and comparable claims.
- The investigation. The adjuster gathers evidence, statements, medical records, or repair estimates, and liability and damages become clearer over time.
- The adjustment. Reserves increase or decrease as new information arrives, and partial payments, such as medical bills or temporary repairs, may go out while the claim stays open.
- The closure. The carrier issues final payment, denies the claim, or settles litigation, and the claim status changes from open to closed with a final paid total recorded.
Real Claim Examples Involving Open Claim
Water damage claim awaiting contractor estimates
A homeowner reports a burst pipe that damaged flooring and drywall. The carrier opens the claim and sets a preliminary reserve, but the file stays open for several weeks while contractors submit competing repair estimates. The reserve shifts upward once mold remediation is added to the scope. The claim finally closes when the carrier approves the final invoice and issues payment.
Workers compensation claim with ongoing medical treatment
A warehouse employee injures their back lifting inventory and files a workers compensation claim. The claim remains open for over a year because the employee continues physical therapy and the treating physician has not released them to full duty. The reserve is adjusted multiple times to reflect updated medical cost projections. The claim closes only after the employee reaches maximum medical improvement and a final settlement or return-to-work date is confirmed.
General liability claim tied up in litigation
A customer slips at a retail store and sues for damages beyond the initial reserve estimate. The claim stays open through discovery, depositions, and settlement negotiations, sometimes for two or three years. The agency's renewal submission shows this claim as open with a growing reserve, which concerns the underwriter reviewing the loss run. The claim eventually closes with a negotiated settlement that comes in below the peak reserve amount.
Open Claim vs. Closed Claim: What Is the Difference?
Open claim and closed claim describe two ends of the same claim lifecycle, and both terms matter for how agencies read loss runs. An open claim still carries an active reserve and unresolved liability, while a closed claim has a final, confirmed outcome.
| Comparison area | Open Claim | Closed Claim |
|---|---|---|
| Primary use case | Tracking active reserves during investigation or litigation | Reporting final loss history for underwriting |
| Coverage / concept type | Claims status, not a coverage provision | Claims status, not a coverage provision |
| Typical exclusions | Not applicable; a status label, not a coverage term | Not applicable; a status label, not a coverage term |
| Who is most affected by errors | Underwriters pricing renewal risk off incomplete data | Policyholders disputing an inaccurate final loss figure |
| Common mistakes | Treating the reserve as the guaranteed final cost | Assuming a closed claim can never reopen |
What Are the Most Common Mistakes With Open Claim?
- Agencies quote renewal premiums using a loss run with stale open claims, overstating the account's true loss exposure and triggering unnecessary premium increases.
- CSRs tell clients the reserve amount is the final cost, setting inaccurate expectations when the claim later closes for a different figure.
- Producers fail to request an updated loss run close to the renewal effective date, missing recent claim closures that would improve pricing.
- Account managers assume a closed claim cannot reopen, when some jurisdictions allow reopening if new medical issues or damages surface.
- Agencies neglect to follow up with adjusters on claims that have stayed open unusually long, missing a chance to push for resolution before renewal.
How to Explain Open Claim to a Client
Explaining Open Claim to a personal lines client
Your claim is still open, which means the insurance company hasn't finished reviewing everything yet. They've set aside an estimated amount to cover it, but that number can change as repairs or medical treatment continue. Once everything is finalized, the claim will close and you'll see the final payment amount.
Explaining Open Claim to a small business owner
An open claim on your loss run means the insurance company hasn't closed the file yet, so the number you see is an estimate, not a guaranteed final cost. This matters at renewal because underwriters look at open claims and may price your policy based on the current reserve. We'll keep an eye on it and request an updated loss run closer to your renewal date.
Explaining Open Claim to a CFO or risk manager
Open claims on your loss run carry active reserves that underwriters factor into renewal pricing, even though the final paid amount may differ significantly from the reserve. I recommend we request a current loss run thirty to sixty days before renewal so we're working with the most accurate open claim data available. If any claims have been open an unusually long time, we can push the carrier for a status update before we go to market.
Frequently Asked Questions About Open Claim
How long can a claim stay open?
An open claim can stay open anywhere from a few weeks to several years, depending on the complexity of the loss. Property claims with straightforward repairs often close within weeks, while workers compensation or liability claims involving litigation or ongoing medical treatment can remain open for years.
Does an open claim affect my premium right away?
An open claim can affect premium at the next renewal, not immediately, because carriers typically reprice risk based on loss history reviewed during underwriting. The reserve amount on an open claim is what underwriters see when they calculate experience modification factors or loss ratios.
Can an open claim be closed and then reopened?
Yes, many states and carrier practices allow a closed claim to reopen if new damages or medical complications arise related to the original loss. This is more common in workers compensation claims, where a reopened claim restarts the reserve and payment process.
Why does my loss run show a reserve instead of a final number?
Your loss run shows a reserve because the claim is still open and the insurer has not determined the final cost. The reserve is the adjuster's best estimate at that point in time and will be replaced with the actual paid amount once the claim closes.
Should I request an updated loss run before renewal?
Requesting an updated loss run close to the renewal date is a strong practice because it captures any claims that closed for less than their reserve. This can improve how the account looks to underwriters and may lead to better renewal terms.
Who decides when a claim moves from open to closed?
The claims adjuster assigned to the file makes the determination to close a claim, typically after final payment is issued, a denial is finalized, or litigation concludes with a settlement or judgment. The policyholder does not control this decision but can request status updates at any time.
Related Insurance Terms
- Closed Claim: A claim that has reached final resolution through payment, denial, or settlement, with no further reserve activity expected.
- Claims Reserve: The estimated dollar amount an insurer sets aside for an open claim to cover anticipated damages before final resolution.
- Loss Run: A report listing an insured's claims history, including open and closed claims, used by underwriters to price renewal risk.
- Experience Modification Factor: A workers compensation pricing adjustment calculated partly from open and closed claims that reflects an employer's loss history compared to industry peers.
- Subrogation: The process by which an insurer recovers claim payments from a responsible third party, which can affect how long a claim stays open while recovery efforts proceed.
Sources and References
- NAIC. Claims Handling.
About the Author
Justin Goodman, CIC, CCIP, CISC, CLCS, CRIS, PCIA, QCLS, MFHR CEO and Co-Founder, Total CSR, Inc.
Justin Goodman is a third-generation insurance broker with over two decades in agency operations. He has trained more than 100,000 CSRs, account managers, and producers in commercial and personal lines coverage, from workers' compensation to construction risk. He was named 2024 Insurance Journal Agent of the Year and one of the nation's top five construction insurance experts by Risk & Insurance. He is the author of Retain, which applies cognitive science research on memory and knowledge transfer to insurance training, and speaks nationally on how agencies build durable technical expertise in their teams.