Extended Reporting Coverage, also called tail coverage, is a type of policy that can be added onto an agency’s current errors and omissions insurance. This type of coverage can be important for a number of reasons. Continue reading to learn more.
A tail insurance policy is not an extension of errors and omissions coverage. Rather it is an extension of the report by date. This allows companies additional time in which to report an event that is covered by their errors and omissions policy. In most cased this type of coverage is used when a business is being sold or closed and needs to know that they will be able to report any last minute claims that occurred prior to the expirations of their insurance. Errors and omissions policies may also be useful if an agency is changing or reducing their offered coverage packages as may help in the event of a client misunderstanding over their policy and the tail coverage helps the agency they have the time needed to report such an event.
Extended Reporting Coverage can be important for a company that is planning to sell and needs to extend the allotted reporting time for their errors and omission policy. Also called tail coverage, these policies can also be useful for businesses that are closing or changing their offered policies.