A recent case from the U.S. District Court for the Eastern District of Missouri demonstrates why policyholders must take care to provide prompt, timely notice under claims-made insurance policies. In Secure Energy, Inc. v. Philadelphia Indemnity Insurance Co., No. 11-1636 (E.D. Mo. May 15, 2013), the Court clarified that under Missouri law, an insurer who raises late notice as a condition precedent to coverage is not required to demonstrate that it has suffered prejudice as a result of a policyholder’s late notice under a claims-made policy. Philadelphia Indemnity Insurance Company (“PIIC”) insured Secure Energy, Inc. (“Secure Energy”) under annual D&O and employment practices liability policies on a claims-made basis. In December 2007, Secure Energy’s Board of Directors received a memorandum from an individual requesting commissions allegedly owed. The individual subsequently filed a lawsuit in May 2008, to which Secure Energy was added as a defendant in April 2009. Security Energy did not notify its insurer of the claim until May 2011. PIIC denied coverage on grounds that Secure Energy’s notice of the claim was untimely and therefore outside the scope of coverage. Secure Energy filed a declaratory judgment action, and the parties thereafter moved for summary judgment on the issue of late notice. Secure Energy argued that PIIC must establish prejudice as a result of the late notice in order to bar coverage. The Court disagreed and granted PIIC’s summary judgment motion, noting that prejudice is required only as to “occurrence” policies under Missouri law – not “claims-made” policies. Several Missouri state and federal courts have reached the same conclusion.