Extended Reporting Period (Tail Coverage) on Claims-Made Lines
What this clause says
In the event of termination, expiration, or non-renewal of any claims-made coverage required hereunder, Vendor shall purchase Extended Reporting Period (ERP) coverage of not less than three (3) years, or shall maintain prior-acts coverage with a successor carrier with retroactive date no later than the original effective date of the terminated policy.
What this means in plain English
Tail coverage (also called Extended Reporting Period or ERP) extends the time window during which a claim can be reported under a claims-made policy after the policy has been cancelled, non-renewed, or replaced. Without tail, claims arising from prior-period acts but reported after expiration are uncovered.
What it means for a CDMO program
Critical when transitioning carriers on claims-made lines (professional liability, D&O, cyber, EPLI, fiduciary). Operators either purchase tail from the expiring carrier (typically 100%-300% of expiring annual premium) or negotiate a sufficiently old retroactive date with the new carrier. Sponsor MSAs increasingly require tail purchase as a contractual obligation.
How this evaluates
The Decoder applies these rules in order; the first match wins.
- tail › maintained is set → Compliant: Tail coverage or prior-acts maintained.
- tail › maintained is not set → Borderline: No tail coverage indicated.
See this in your MSA
Pre-loaded with this clause selected.
Run the Decoder