Short answer
When a contract requires professional liability for years after completion, no policy promises coverage for the next six years. Professional liability policies are claims-made and renew yearly. You meet a multi-year requirement by renewing without a gap, showing a certificate each year if asked, and buying an extended reporting period (tail) if you close or stop practicing. Write that commitment into the contract instead of promising a policy that does not exist. Whether a policy responds depends on its wording and the facts.
Why owners ask for years of coverage
Owners ask because design claims can surface years after a project ends. State laws called statutes of repose set an outside time limit for lawsuits over design and construction, usually measured from substantial completion.
Colorado offers a useful example. Under C.R.S. 13-80-104, actions against architects, engineers and other construction professionals generally must be brought within six years of substantial completion. If a claim arises in the fifth or sixth year, the statute allows two more years to bring it. That is why owners and their attorneys often talk about “six plus two.”
Other provisions can affect timing, and other states set different periods. Ask your attorney how the rules apply to your project.
What you can promise when a contract requires professional liability for years after completion
A claims-made policy responds to claims first made while the policy is in force, subject to its terms and its retroactive date. Because of that structure, a firm cannot promise a single policy that spans six years. A firm can promise behavior that keeps coverage in place.
Common commitments include:
- Maintaining professional liability coverage continuously for a set number of years after completion
- Providing a certificate of insurance each year on request
- Buying an extended reporting period if coverage ends
Continuous renewal matters because a gap can cut off coverage for older work. Keep your retroactive date in place across renewals. Our article on retro dates explains how that date works.
Contract wording to consider
Counsel should draft the actual language. A few ideas can guide the discussion. Many firms ask for qualifiers such as “commercially reasonable” or “if available” next to the coverage requirement. Market conditions can change, and a requirement that ignores them can leave a firm in breach through no fault of its own.
Some contracts also name a required limit. Ask your agent whether that limit will likely stay available to you each year. If the market changes, the firm needs a path to discuss alternatives with the owner.
Describe the issue to your attorney in plain terms. A claims-made policy cannot be promised for years, but continuous renewal and a tail can be.
Where tail coverage fits
An extended reporting period applies when your practice policy ends. That might happen if you retire, close the firm or change carriers without matching your retro date. The extended reporting period lets you report claims after the policy ends for work done before it ended.
Tail coverage is not needed while you keep renewing without a gap. Our article on extended reporting periods covers lengths and options. Terms and pricing vary by insurer.
Retirement is a common reason firms ask about this. A firm that commits to a tail in its contract is telling the owner that coverage for older work will continue even if the firm stops practicing.
Questions to ask your agent
These questions can start the conversation:
- Is the required limit available to me every year?
- What if the market changes?
- How long a tail can I buy?
- Does my policy keep my retroactive date across renewals?
What we see at Hardcover
A Colorado firm acting as prime on a multifamily project expected the developer to require coverage for the full statutory window. The firm’s attorney had flagged it. The owner asked how to answer, since no one sells a policy that says “covered for the next six years.”
We explained that the answer is continuous renewal plus a tail if they stop. We also suggested their attorney write it that way in the contract.
Related questions
The client is likely going to want something that says we’re covered for the next six years. How do I satisfy that?
Offer a commitment to maintain coverage continuously for the required period, provide certificates on request and buy an extended reporting period if coverage ends. Have your attorney put that wording in the contract.
Can I buy a policy that covers me for six years?
Not as a single promise. Claims-made policies renew annually, so you keep them in force continuously.
What if I retire before the six years are up?
Buy an extended reporting period (tail). Lengths and prices vary by insurer.
What is a statute of repose?
A law that sets the outside time limit to sue over construction or design, usually measured from completion.
General education, not legal advice. Hardcover is an insurance agency, not a law firm.