Reasons to Have Tail Insurance
An Extended Reporting Coverage (ECR) policy also referred to as tail insurance coverage, may be a useful plan for your agency to have. A tail policy can extend the time frame in which an incident covered by your errors and omissions policy may be reported. Here are a few reasons you may want to consider tail insurance for your company.
The Agency is Being Sold or Changing Hands
If you are in the process of moving away from your agency whether due to sale or retirement, you may no longer be covered by your errors and omissions policy. However, tail coverage can extend your reporting date so that you can still submit claims that occur prior to the coverage laps.
You are Changing the Insurance Options You Offer
In some cases your agency may be in the process of changing the policies you offer your clients. A tail policy can help ensure that you are covered in the event that a client makes a claim of negligence as a result. These claims are often considered personal and not covered by errors and omissions policies in some cases.
Having a tail policy in place can help insure that you don’t run out of time to report an incident. Maintaining tail insurance may also help in the event that your business is changing hands, or the policies your company offers change. If you have further questions a professional may be able to help.