Tail coverage is associated with which type of policy?

• A. Occurrence-based CGL
• B. Claims-made liability policy
• C. Property policy
• D. Workers' Comp

Answer: (B)

Tail coverage is tied to claims-made liability policies because, in this form, coverage depends on when a claim is reported, not just when the injury or loss occurred. If the policy ends before a claim is filed for an incident that happened during the policy period, there can be a gap in coverage. Purchasing tail coverage, or an extended reporting period, allows the insured to report claims after the policy ends, preserving protection for claims tied to prior periods.

This concept isn’t relevant to occurrence-based CGL policies, where coverage is triggered by the event happening during the policy period, regardless of when a claim is filed, so there’s no separate tail. Property policies aren’t claims-made and cover physical damage to property, so tail coverage isn’t a feature there. Workers’ compensation, governed by state law, isn’t structured around a tail provision in the same way as individual liability policies.