What Does Tail Coverage Mean?
Tail coverage extends the reporting period of malpractice insurance so that medical practitioners can report a wrongful act even after their malpractice insurance lapsed or was cancelled. However, the extension only applies to wrongful acts that happened while the malpractice insurance policy was still in force, and it does not apply to wrongful acts that occured after the malpractice coverage ended.
Insuranceopedia Explains Tail Coverage
For example, a surgeon lets their malpractice insurance expire in July and does not renew nor purchase another policy. In August, the surgeon is sued for a procedure that went badly in May. If the surgeon had tail coverage, the surgeon could report the wrongful act to their insurance company even though they let their malpractice coverage expire.
Tail coverage tends to be fairly expensive because medical providers who are at risk for a lawsuit for previous actions and who don’t have malpractice insurance for these potential lawsuits often purchase it. As a result, insurers charge more to account for the higher risk of the expenses of dealing with a lawsuit.