Tail Coverage Insurance: Insurance Protection Beyond the Policy Period

If you are a physician or healthcare professional, then you are likely familiar with the importance of medical malpractice insurance. This type of insurance is designed to protect you in the event that a patient files a lawsuit against you due to alleged malpractice. However, what happens when your insurance policy expires, and a lawsuit is filed against you after your policy period has ended? This is where tail coverage insurance comes into play.

What is Tail Coverage Insurance?

Tail coverage insurance, also known as an extended reporting endorsement (ERE), is a type of insurance that provides coverage for claims that arise after the expiration of a claims-made insurance policy. In other words, if a claim is filed against you after your policy period has ended, tail coverage insurance will provide coverage for that claim.

Claims-made insurance policies are the most common type of medical malpractice insurance policy. These policies are designed to cover claims that are made during the policy period, regardless of when the alleged malpractice occurred. However, if a claim is made after the policy period has ended, the policy will not provide coverage unless tail coverage insurance is in place.

It’s important to note that tail coverage insurance is not a standalone policy. It is an endorsement that is added to a claims-made insurance policy. It provides coverage for claims that arise after the policy period has ended, but it does not provide coverage for claims that arise during the policy period.

How Does Tail Coverage Insurance Work?

When you purchase a claims-made insurance policy, you are only covered for claims that are made during the policy period. If a claim is made after the policy period has ended, the policy will not provide coverage unless tail coverage insurance is in place.

Tail coverage insurance provides coverage for claims that are made after the policy period has ended, but only for incidents that occurred while the policy was in force. In order to be eligible for tail coverage insurance, you must have had a claims-made insurance policy in place prior to the expiration of the policy.

The cost of tail coverage insurance varies depending on a number of factors, including the type of policy, the length of time you need coverage, and the amount of coverage you require. It is important to discuss your tail coverage insurance options with your insurance provider to ensure that you have the appropriate coverage in place.

Why Do You Need Tail Coverage Insurance?

There are several reasons why you may need tail coverage insurance, including:

1. Retirement – If you are planning to retire or leave your medical practice, you may need tail coverage insurance to protect you in the event that a claim is filed against you after you have left the practice.

2. Relocation – If you are relocating to a new state or practice, you may need tail coverage insurance to protect you in the event that a claim is filed against you after you have left your previous practice.

3. Change of Employment – If you are changing employers, you may need tail coverage insurance to protect you in the event that a claim is filed against you after you have left your previous employer.

4. Consolidation or Merger – If your medical practice is being consolidated or merged with another practice, you may need tail coverage insurance to protect you in the event that a claim is filed against you after the consolidation or merger is complete.

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Conclusion

Tail coverage insurance provides crucial protection for healthcare professionals who have had a claims-made insurance policy and are leaving their practice. It provides coverage for claims that arise after the policy period has ended, but only for incidents that occurred while the policy was in force. It’s important to discuss your tail coverage insurance options with your insurance provider to ensure that you have the appropriate coverage in place.