Providing professional services can entail long-term risks. Doctors might see a malpractice lawsuit up to six years after the event. In the case of tech startups, mistakes might not be recognized until long after the company was bought out. For these types of situations and many others, tail insurance is there to mitigate risk. It covers claims made after your errors and omissions policy is canceled, as long as the claim is for an event during the covered period. Read on for two situations where your business might need a tail insurance policy.
You Change Companies
If you are a professional, such as an attorney or physician, your professional liability coverage will change when you change practices. To make sure you are covered for any claims made about your services at your prior employer, purchase tail insurance to extend your claim reporting period or look into prior acts coverage from your new insurance.
You Sell Your Company
For startups, being bought out by a larger business can be the end goal. Tail insurance should be part of your sales plan. You will protect the executives on your team even as they move on to new challenges. The company buying you out will also want to know that they won’t be on the hook for mistakes that may come up after you’ve left.
Tail insurance watches your back so you can move forward with confidence.