Tail Coverage

What is tail coverage?

Tail coverage is an insurance endorsement providing an extended reporting period after a claims-made policy ends. It allows claims to be reported for work performed during the original policy period even after that policy terminates. Tail coverage protects against the fundamental limitation of claims-made policies: that they only cover claims made while coverage is active.

How tail coverage works

When you purchase tail coverage, you pay a one-time premium for a defined or unlimited reporting period. During this period, you can report claims for incidents that occurred while your original policy was in force. The claim will be covered under the terms and limits of the original policy. Without tail, any claim reported after policy termination would be denied regardless of when the underlying work occurred.

Alternatives to purchasing tail

A new insurer may offer prior acts coverage, essentially providing tail through the new policy for work predating inception. This requires no coverage gaps and disclosure of prior work. Some professionals transition to occurrence-based policies that do not need tail. If joining another firm, their policy may extend coverage to your prior work. Evaluate all options before purchasing standalone tail coverage.