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Tail Coverage Explained


Need a simple tail coverage definition? Tail coverage is a type of cyber, professional, management and employment liability insurance. Also known as an Extended Reporting Period Endorsement, it allows professional individuals to report claims for wrongful acts that took place after their claims-made policy’s retroactive date and before the policy expires.

Tail coverage is typically available for an additional premium through licensed insurance providers. It is a one-time, non-expiring purchase that neither the purchaser nor the insurance provider can cancel.

Which Professionals Need Tail Coverage?

Axis Insurance Services of Franklin, New Jersey, reports that the following professionals typically need tail coverage:

  • Architects
  • Consultants
  • Engineers
  • Dentists
  • Doctors
  • Mortgage brokers
  • Real estate agents

For example, a retiring doctor needs tail coverage. A doctor changing jobs may also need it if a new place of employment does not provide Prior Acts Coverage, also known as nose coverage. Similarly, a real estate agent needs tail coverage if selling their agency.

How Much Tail Coverage Should a Professional Purchase?

Professionals should purchase as much tail coverage as they can afford. A tail coverage policy’s cost is typically a multiple of the active premium, so the cost depends on several factors. Individuals seeking tail coverage should engage a licensed insurance provider to learn more about the options available to them.