An extended reporting period is an additional stretch of time after a claims-made policy ends during which claims can still be made and trigger coverage under the expired policy. The market calls it tail coverage. It covers only claims arising from wrongful acts that happened between the retroactive date and policy expiration, not new work performed after the policy ends.
You will place ERPs whenever a client leaves a claims-made program: nonrenewal, a carrier move to an occurrence form, a retirement, or the sale of the business.
Extended Reporting Period
A period after the expiration of a claims-made policy during which claims first made against the insured may still trigger coverage, limited to acts committed on or after the retroactive date and before policy expiration.
How does an extended reporting period work?
A claims-made form pays only when the claim is first made during the policy period, for acts on or after the retroactive date. Cancel or nonrenew the policy and every future claim falls outside that window, even claims from work performed while coverage was in force. The ERP repairs this by extending the reporting window without extending the coverage period.
Claims-made forms typically build in a basic ERP with two tails, both at no additional premium: 60 days after expiration for claims first made after the policy ends, plus a longer 5 year window for claims that arise from occurrences the insured actually reported to the insurer during the policy period. The supplemental or additional ERP is the one the client buys, running for a fixed term of years or unlimited, priced as a percentage of the expiring premium stated in the declarations.
Two mechanics trip people at the desk: the election window for the supplemental ERP is short, often 60 days from expiration, and on many professional and management liability forms the tail is withheld when the policy was cancelled for nonpayment of premium, though the ISO general liability form imposes no such bar.
What does tail coverage not do?
An ERP extends reporting, nothing else. It does not cover acts committed after the policy expired, does not advance the retroactive date, and on most forms does not reinstate limits, so the expiring policy's remaining aggregate limit is all the tail ever has. If earlier claims ate the aggregate, the tail can be an expensive empty shell, which is why you pull loss runs before quoting one.
The cleaner alternative when the client is simply changing carriers is prior acts coverage: the new claims-made policy carries the old retroactive date forward, keeping the reporting window alive without a tail purchase. Reserve the ERP for true exits, when there is no next policy to carry the retro date. The full trigger comparison, including how switching between forms creates gaps, is in our guide to occurrence versus claims-made policies.
Frequently asked questions
Is tail coverage the same as an extended reporting period?
Yes. Tail coverage is the market name for the extended reporting period, most often the supplemental ERP purchased at policy termination. Both describe the same thing: extra time to report claims under an expired claims-made policy.
How much does an extended reporting period cost?
Supplemental ERPs are priced as a percentage of the expiring annual premium, stated in the declarations. On the ISO general liability form the charge is capped at 200% of the annual premium, though some professional liability tails run higher. It is a one time charge, and it is rarely negotiable after expiration.
How long do I have to buy tail coverage?
The election window is set by the policy and is short, often 60 days from the end of the policy period. Miss it and the option is gone. Calendar the deadline the day you learn a claims-made policy is terminating.
Does an ERP give the insured new limits?
Usually no. Most forms make the ERP subject to the expiring policy's remaining limits, so prior claims that eroded the aggregate reduce what the tail can pay. Some insurers offer reinstated limits for the ERP at an added charge, so ask at quoting.
This definition is for educational purposes. Your policy's specific terms, conditions, and endorsements control. Talk to a licensed broker about your actual exposures.