I am a physician considering retirement soon. I have been told that I need to buy a “tail” on my Professional Liability Insurance policy. Is this true?
Yes. Once you retire and your professional liability policy is cancelled, coverage immediately ceases for claims arising out of all professional services rendered prior to the date of cancellation;unless you purchase an extended reporting period endorsement (aka tail). Your Insurance Carrier is legally required to offer you a tail, in writing. In many cases, if you have been insured with the same insurance carrier for more than 5 years, the tail endorsement is free. If you are retiring before age 55, there may be an additional premium charged for the tail. The tail provides professional liability coverage for claims that are reported after the policy is cancelled, regardless of when the service was provided. Without a tail, there would be no coverage for these claims and your personal assets would be at risk.
