Thinking of closing or selling your practice?

Should members exceed this £250K annual fee threshold – or should they conduct certain types of work – they may incur additional premiums.

PII Limit of Insurance Tables for Accountants

check_small PII sends a clear message to your clients that there is financial backing in the very unlikely event of a mistake. This can enhance their trust in your practice. Your clients put a great deal of trust in your professional bet best betting sites uk for horse racing expertise and years of experience. They trust you with their personal information and sensitive financial data – and they pay you for your expert advice. Most of the time, your client’s work will be plain sailing.

3.6 Subsidiary undertakings, networks and overseas branches

However, there’s always the possibility that something could go wrong. We are all human, after all: it’s always possible that your practice could make errors or unintentional omissions or that you could provide advice that leads to a client’s financial loss. Should they decide to take legal action as a result, the financial burden on your practice could be significant. Professional indemnity insurance provides you with a safety net. It ensures that you are able to defend your practice against any potential legal claims from clients without footing the full financial cost yourself. After completing a declaration before the policy term begins, members will be informed as to whether this applies.

Before our accountants’ PI insurance cover can begin, ICPA members will need to complete an application and declaration process.

Tailor your accountants insurance in minutes with these covers

If fees exceed this figure, or if the member conducts certain types of work, additional premiums may be incurred. ICPA Premium members receive an increased level of cover - an upgrade to our former single membership package. As with the cover for Pro members, this cover is subject to certain conditions. ICPA Essentials members receive £100K of PII cover as standard. As with any insurance policy, ICPA’s PII cover is subject to certain membership conditions – and there are instances where additional premiums may be required: Our standard PII cover applies to members whose annual fees total up to £250,000. This should be completed accurately to ensure that your professional liability insurance is valid and that you receive bet betting sites with fast withdrawal the appropriate coverage, tailored to your exact needs. While it can be tempting to choose a PII policy based on price, you need to ensure that you are getting the right level of coverage for your money. “The right level of cover” will vary from practice to practice and depend on several factors.

• Fines for non-compliance with Employers' Liability insurance are enforced by the Health and Safety Executive (HSE).
• Operating without required motor insurance can lead to vehicle seizure, fines, and penalty points.
• Breaching contractually agreed insurance levels can lead to contract termination and legal claims.
• Operating without mandated Professional Indemnity can result in disciplinary action from your regulatory body.
• Inadequate insurance can lead to personal liability for directors if the company cannot cover claims.

The size of your practice will have a part to play, as well as the complexity of the services that you offer. The makeup of your client base and the types of work that you do will also affect the cover level you choose: the higher the potential financial impact of a claim against you, the higher the level of cover you will need.

PII policies, like any other insurance policies, are priced based on potential risk.

We can crunch the numbers

When considering limits, estimates around the cost of losing data and dealing with ensuing liability claims is imperative. This exposure will vary for all types of businesses but has particular relevance for professional service firms. The setting of PI limits over and above minimum regulatory limits should not be arbitrary nor based on premium alone, but a true reflection of the business’s risk exposure and tolerance, against a background of the professional services undertaken. As well as PI exposure, a number of other factors deserve consideration when assessing business risks, including the possible transfer of risks relating to crime, cyber security and management liability. A full and timely discussion with your broker is recommended.

6.3 Heads of damage in tax PI claims

If you have any questions, please contact your Lockton Account Manager for further advice or email accountants@uk.lockton.com. Are you an accountant in need of professional indemnity (PI) insurance? As a practice providing professional services to its clients, you must ensure that you’re protected should anything go wrong. Having the right accountants’ Professional Indemnity Insurance in place is the answer. Join ICPA for enhanced, ICAEW-compliant insurance to protect yourself and secure your practice against unforeseen client claims. Risk factors included in pricing calculations include the categories of work your practice undertakes, any claims history, your practice’s fee income and the ratio of partners or directors to staff at your practice.

PII Regulations

check_small Through our membership, ICPA members benefit from insurance provided by AXA. We are proud to be working with such a reliable and credible professional liability insurance provider. check_small Members will be pleased to know that AXA is A-rated, demonstrating their excellent ability to pay out in the case of a claim. check_small Professional indemnity insurance is vital for any professional services business - but different types of businesses have different needs. check_small Rather than choosing a one-size-fits-all PII policy, we’ve partnered with AXA for cover that is specifically designed to meet the unique needs of accounting professionals.

8.2 Scope of AAT licence

check_small Purchasing standalone liability cover for accountants can be costly. With an ICPA membership you benefit from the value for money and peace of mind that come with comprehensive, compliant insurance - as well as all of our other membership benefits. check_small ICAEW affiliation requires individuals and small practices to meet incredibly stringent requirements in a range of areas. check_small Our professional indemnity insurance meets these requirements, making ICPA membership an ideal choice for ICAEW affiliates. check_small Taking out professional indemnity insurance will cover any legal fees you need to pay any damages awarded against you, safeguarding your financial stability. Once you have chosen a potential policy, be sure to read the documentation carefully.

How much PII does an accountant need?

Such cover was typically not expressly worded, but ‘silent’. As from 1 January 2021, Lloyd’s markets are now requiring that PI policies either positively affirm or categorically exclude cyber cover from PI policies, by way of endorsement. The intention is that cover for cyber-related issues should be clear and categorical - no longer silent. Non-Lloyd’s markets are also reviewing their positions. This has implications on PI coverage limits.

Premium Members – £500k Cover (New)

Whether cover for cyber-related incidents is affirmed or excluded, an analysis of the effect of the endorsement will be critical. An exclusion of cyber cover may mean more cover is available for other PI claims (although potentially leaving an uninsured exposure that needs to be considered). By contrast, an endorsement of affirmative cover within the PI policy may mean that a cyber-related claim could erode PI limits. This possibility might necessitate an increase in PI limits, particularly when considering the exponential rise in ransomware attacks: attacks increasingly involving the exfiltration and release of confidential information into the public domain. A key exposure for any accountancy business is the sensitive data held on its clients. Before you proceed, you’ll want to make sure that every element of cover you need is included and that you have a strong understanding of the policy wording. If you want to take advantage of our professional indemnity insurance cover – along with all of our other membership benefits – join the ICPA today. Because we want to make ICPA membership as accessible as possible, we have simple joining criteria.

• UK employers must have Employers' Liability (EL) insurance with a minimum cover of £5 million.
• The EL certificate must be displayed at each business premises where employees work.
• Insurance must be provided by an authorised insurer under the Financial Services and Markets Act 2000.
• Cover is required for all employees, including temporary, casual, and contracted staff.
• Certain businesses, like family businesses with no direct employees, may be exempt.
• Failure to have EL insurance can result in fines of up to £2,500 per day.

As long as you have at least three years of experience in working in practice in a taxation or accounting role at a manager or partner level; or hold a practice certificate or licence with a qualifying organisation, we’d love to have you on board. Once you are an ICPA member, we’ll send you full details of how to complete your accountants’ PI insurance application. When you apply, you’ll need to include information such as your total annual fees and information on the types of work you conduct, so be sure to have this to hand.

Why Professional Indemnity Insurance Matters for Accountants

Dedicated insurance for small accounting practices will give your clients peace of mind – as well as safeguard your professional reputation and underpin your financial stability. Each of our three membership options features different indemnity insurance options. As standard, Pro members receive £300K of cover, Premium members receive £500K of cover, and Essentials members receive £100K of cover. Our policies can be tailored to suit you, and the cover can be for £1M if required. ICPA Pro members receive £300K of professional indemnity cover as standard - conditional on the individual or practice having fees no greater than £250K per annum. Read the declarations in the policy application carefully: a failure to disclose information accurately and fully may mean that your cover is invalid. Professional indemnity insurance for accountants tends to cover four key areas of risk, namely: This includes any oversight or mistakes resulting from your firm’s work, such as providing incorrect advice or miscalculations. Your practice will have a large amount of client data and documentation in its care. Should this data or documentation become damaged or lost, your PII policy will have you covered. A client may make a defamation claim if you say or publish something in your professional capacity that results in their reputation being damaged. Whether intentional or unintentional, the sharing or loss of confidential client data can have significant consequences for their business. PII can cover the cost of compensation payouts and legal fees should this happen, protecting your practice’s finances. There are plenty of ways in which you can benefit from being a member of the ICPA.

Feel free to contact us with any further questions you have about our PII cover – or see our frequently asked questions below: Professional indemnity insurance (PII) is available for all types of professionals, including accountants. It protects you in the rare event that a client files a claim against your business, believing that they have suffered loss or damage as a result of something that your practice has done.