What is 'run-off coverage' in SAP FS-PM - Policy Management?

run-off coverage - Overview

• Component: FS-PM

• Component Name: Policy Management

• Description: The extension of risk coverage by the insurer beyond the end of the contract in business liability insurance. This means that losses can also be insured that occur after expiration of the insurance contract; mainly when the contract has been annulled due to termination of business by the policyholder.

run-off coverage - Details

• 
  Key Concepts: 
  Run-off coverage is a type of insurance policy that provides coverage for claims that have already occurred but have not yet been reported. It is typically used to cover liabilities that may arise from past activities, such as those related to a business that has been sold or closed. In the context of SAP FS-PM Policy Management, run-off coverage is used to manage the risks associated with policies that have been terminated or are no longer in effect. 
  
  How to use it: 
  In SAP FS-PM Policy Management, run-off coverage can be used to manage the risks associated with policies that have been terminated or are no longer in effect. This type of coverage can be used to protect against potential liabilities arising from past activities, such as those related to a business that has been sold or closed. The policy can be set up to provide coverage for a specified period of time, such as five years, and can be tailored to meet the specific needs of the organization. 
  
  Tips & Tricks: 
  When setting up run-off coverage in SAP FS-PM Policy Management, it is important to consider the specific needs of the organization and tailor the policy accordingly. It is also important to ensure that the policy is set up for the correct period of time and that all relevant information is included