Tail Policy: Coverage on the Back End

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Tail Policy

Insurance companies show buyers a myriad of coverage options to make sure that they meet each client’s specific needs. This includes offering coverage for times when people don’t think it is needed anymore. Additional coverage is always beneficial, but exactly what is a tail policy?

What Is the Difference Between a Tail Policy and ERP?

A tail policy is also referred to as standalone Extended Reporting Coverage. It is not an extension of the policy, but it allows holders to make claims for events that occurred during the time they were insured.

While some policies may already have some type of ERP included, a tail policy differs from a standard ERP in that it is often done by a separate insurance company under certain situations.

Why Should You Add a Tail Policy?

There are two main reasons to add a tail policy. First, holders have more relief during times of transition because they know that they have coverage to support them. This could be during a big change such as retiring, buying another business, or selling an existing business.

Second, these policies allow more flexibility than standard ERP. Buyers can tweak costs, limits, etc., to suit their needs.

If having insurance for everyday happenings makes buyers feel safe, then why not have flexibility and reliability during times of change? Protection on the back end of an insurance policy can add that extra bit of relief.

This post was written by , posted on August 13, 2020 Thursday at 7:34 am