Insurance Expert Witness Defines Risk Management Terms Part 2

Insurance expert witness Jim Leatzow has been educating and insuring professionals about the risks to their businesses for twenty years. At, he offers a glossary of jargon associated with risk management. Two of the terms he defines are:

Run-Off Period Time following the expiration of an E&O policy which is then covered by a tail policy or endorsement.

Tail Coverage/Policy Tail coverage/Tail policy covers a firm for their risks that were created while a traditional E&O policy were in force, but where the firm is no longer practicing for whatever reason. This is typically called the “Run-Off Period”. It is different because no new work is being undertaken by the firm and any prior risk is “running off” or decreasing as time goes by. A tail policy may be purchased (subject to underwriting) for a period of years and is paid for at issuance. Tail policies generally are “fully earned” upon issuance, which means that there will be no return premium, even if the Tail Policy is cancelled early before its expiration date.

For more, see Leatzow Insurance.