The short version
- Why it exists: a claims-made policy covers claims made while it is active. Without a tail, a claim that arrives after the policy ends is not covered, even for work you did while insured.
- What it covers: claims first reported during the tail, for work done before the policy ended and after the retroactive date.
- What it does not do: cover new work after the policy ends, or add limits. Ask whether it shares your expiring limits or adds a separate limit.
- When to buy it: closing, selling, merging, retiring, or switching to a policy that does not keep your retroactive date.
- How long: at least as long as clients can still bring claims and as long as your contracts require.
When you need a tail
| Situation | Need a tail? | Why |
|---|---|---|
| Closing or dissolving the business | Usually yes | No policy will be in force when later claims arrive |
| Retiring from practice | Usually yes | Same reason; ask whether your policy offers a tail on retirement, death, or disability |
| Selling or merging the business | Often | The buyer's policy may not cover your past work; the purchase agreement should say who buys the tail |
| Switching insurers and the new insurer keeps your retroactive date | No | The new policy covers past work back to the retroactive date |
| Switching insurers and the new policy has a later retroactive date | Yes, or negotiate prior acts | Otherwise work before the new retroactive date loses coverage |
| A contract ends that requires post-contract coverage | Yes, unless you keep renewing | The contract may require claims-made coverage for years afterward |
A market study prepared for Washington's Office of the Insurance Commissioner warns that an organization whose insurer leaves the market may find new coverage only without prior acts, and that a tail from the departing insurer is not always available and may be of limited duration. When an insurer exits, ask about your tail options right away.
How long a tail to buy
| What sets the length | Washington | Idaho |
|---|---|---|
| Deadline to sue for professional negligence | Generally three years, and courts often start that clock when the client discovers or should have discovered the problem (RCW 4.16.080; Peters v. Simmons) | For licensed professionals, generally two years from the act, once some damage has actually occurred (Idaho Code 5-219(4); City of McCall v. Buxton) |
| Claims on a written contract | Six years (RCW 4.16.040) | Five years (Idaho Code 5-216) |
| Design and construction | Claims must accrue within six years after substantial completion or the end of services, whichever is later (RCW 4.16.310) | Tort claims start their clock no later than six years after final completion (Idaho Code 5-241) |
Because Washington's discovery rule can push the start of the clock years past the work, a short tail can expire before a Washington client even learns of a problem.
Tails that contracts and rules require
| Requirement | Tail or post-contract coverage |
|---|---|
| Washington statewide IT project management contract (14822) | Claims-made coverage kept for at least three years after the contract ends |
| One Washington DES design-build project (2023-166) | Design E&O renewed for five years after completion |
| Idaho Department of Education solicitation template | A 24-month tail, or continuous coverage with a qualifying retroactive date |
| Idaho real estate licensees | E&O must include an extended reporting period of at least 90 days (IDAPA 24.37.01.100) |
Paste a contract into our contract insurance checker to see whether it requires a tail and for how long.
Questions to ask before you buy
- How long can I buy, and by when? Ask whether there is a deadline to buy the tail after the policy ends.
- Does it share the expiring limits or add new ones? Ask whether the tail shares the expiring policy's limits or carries its own.
- Does my policy offer a tail on retirement, death, or disability, and at what cost?
- Does the tail cover prior acts back to my original retroactive date?
- Who pays in a sale? Put it in the purchase agreement.
Tail coverage for other policies
The same issue applies to every claims-made policy: cyber, EPLI, and D&O. When a company is sold, ask whether former directors and officers need a D&O tail (sometimes called run-off coverage). See claims-made vs occurrence for how these policies work.