Ideally, I would want tail coverage to extend the reporting period for the duration of the statute of limitations during which a former client could sue me for a covered loss. Here (Ohio), that is generally 4 years (with some exceptions). Unfortunately, the last I heard, the companies that write the E&O policies were only willing to offer tail coverage for 1 and half years. But, as Bart said, I'd get it for as long as I could, if I ceased operating as a sole proprietorship.
When I closed my abstracting company, I did not bother with tail coverage. It was an LLC and I had not personally performed any of the searches for years. My exposure to personal liability was very low. I closed the business with about 9 months left on my E&O policy, but I did not extend it with tail coverage.
You should also realize that tail coverage extends the reporting period for a claim - it does not continue to provide coverage for any new work. So, in order to be covered, you must meet two requirements:
1) You have to have had coverage at the time you did the search, or when the error or omission occurred. This would be after your "retroactive date" and before the end of your policy (but before the tail coverage started); And,
2) The claim must be reported to the insurer within the reporting period (as may be extended by tail coverage).
Please let us know what you are able to discover from the carrier. I'll be curious to know if you can get tail coverage for more than a year and a half.
Best,
Robert A. Franco
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