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By Edita Abrudeanu, Founder & Principal Broker — Professional Insurance Experts, LLC
Tail Coverage Explained: Don’t Wait Until the House Is on Fire
Because you can’t buy protection after the damage is done
Last month, a client called me in a panic.
Their firm had dissolved over a year ago, and now a past client was suing over a project that wrapped three years earlier.
Their first question:
“Can we buy tail coverage now?”
I wish I could’ve said yes.
But by then, it was too late.
01. What Tail Coverage Actually Is
Tail coverage — or an Extended Reporting Period (ERP) — lets you report claims after your professional liability policy expires.
Without it, your protection stops the day your policy ends, even if the work was done years ago.
It doesn’t extend the time the policy was active — it simply keeps the door open to report new claims from old projects.
Think of it as your safety net for the past.
02. The “House on Fire” Analogy
Trying to buy tail coverage after a claim appears is like trying to buy homeowners insurance while your kitchen’s already burning.
No insurer will touch it.
Tail coverage must be purchased before your policy expires — while everything still looks calm.
Because when that notice of claim arrives, calm is over.
03. When You Need It
- You’re closing or merging your firm
- You’re retiring or taking a career break
- You’re switching carriers and can’t match the prior retro date
- You’ve had recent project disputes that could surface later
If you fall into any of those, tail coverage isn’t optional — it’s strategy.
04. How Long Should You Extend?
For architects, engineers, and law firms, five years is a good rule of thumb.
Claims often surface long after a project wraps, especially on complex builds or drawn-out litigation.
If you’re retiring or closing permanently, go for the longest tail offered.
You only get one shot.
05. Why It’s Worth Every Penny
Yes, tail coverage can cost 100–300% of your annual premium.
But it covers every project you’ve ever done under that policy.
Compare that to one uninsured claim — six figures in legal fees, easily.
You do the math.
Final Thought
Tail coverage isn’t exciting. It’s not glamorous.
But it’s the difference between a minor inconvenience and a financial disaster.
Don’t wait until smoke is rising to check your coverage.
Protect your past while you still can.
Ready to Make Sure Your Coverage
Actually Protects You?
Let’s review your policy and uncover any gaps before they become problems.