Unless you have the necessary insurance expertise, beware of buying your cover online. Buying a policy online may not give you the cover you actually require. Accountants were one of the first professions to make professional indemnity insurance compulsory for regulated firms.

Is HMRC tax investigation cover the same as PI?

Cover for the financial compensation you have to pay if you made an error, omission or gave negligent advice in the course of your professional services. Your legal defence costs including solicitors, counsel, experts and court fees. Cover for breach of professional duty or unintentional breach of contract where this leads to a claim bet free bets new customer offer for financial loss against you. Professional indemnity claims against Accountants range from hundreds to millions of pounds. Claims can arise from many different scenarios but key areas of risk include ; Misleading or inaccurate advice such as poor tax advice, recommendations or advice on business valuations that leads to quantifiable financial losses.

Limitation period

Failure to detect fraud as an auditor to a company. Loss of documents or data in the accountant’s care including the costs of restoring or replacing them and associated client loss where covered. Certain civil liabilities such as defamation, unintentional breach of confidentiality or intellectual property rights, in the course of providing professional services. Professional indemnity insurance for an Accounting firm is best obtained through a specialist broker. A good broker will reduce the annual premium cost as well as providing invaluable advice and support. Today, it's a large insurance market with many insurers battling for market share. It's important to have some understanding of how the market works to be able to make an informed decision on which product is best for your firm. Does creating the right impression really matter? Professional indemnity insurance for accountants is usually purchased from a specialist broker. A good broker lowers the premium cost as well as providing valuable advice and support throughout the insurance period, especially on claims. We have provided professional indemnity insurance quotations to hundreds of accountancy firms, from new starts to multi million pound businesses. Rates for Accountants PI insurance typically range between .3% and 1.5% of fee income, depending on the usual risk factors and market competition.

For office-based businesses, minimum often includes EL, Public Liability, and contents insurance.
For construction contractors, minimum typically includes EL, Public Liability, and Contract Works insurance.
For consultants, minimum often includes Professional Indemnity and Public Liability insurance.
For retail businesses, minimum includes EL, Public Liability, and Product Liability insurance.
For hospitality, minimum includes EL, Public Liability, and Employers' Liability.

Rates can also be higher or lower than this depending on the work undertaken, the claims history etc.

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.

Rates are discounted for new start firms as there is no history or legacy to insure.

Policy Feature	Requirement	Purpose / Rationale
Run-off Cover	Minimum 6 years post-termination	Covers claims arising from work done while insured
Breach of Confidentiality	Must be included	Protects against inadvertent data disclosure
Loss of Documents	Must be included	Covers costs of replacing or restoring documents
Libel and Slander	Must be included	Protects against defamation claims
Fidelity Guarantee	Optional but recommended	Covers client money dishonesty by employees

You should also bear in mind that minimum premiums will also apply which can vary considerably between insurers. For example, a minimum premium for an accountant could be £ 100 or £ 1,000 depending on the insurer selected.

Why Professional Indemnity Insurance Matters for Accountants

Our Senior Technical Insurance Manager, Ollie Barrett, walks you through what to expect when arranging business insurance with a broker for the first time. We all love to make an extra bit of on the side, but what happens your side hustle goes sideways? If you don't have any business insurance in place, you could end up paying out the cash you've earnt in legal fees or otherwise. Find out what you need to protect your side hustle in this guide. Every year your business insurance is going to be due for renewal.

Business Use Car Insurance for Accountants

But do you stay or switch insurer? How do you know if you need to make changes to cover? We've got it all covered in this guide. Sign-up to The Backbone, our free fortnightly newsletter for anyone who owns, runs, or works in one of the millions of businesses across the UK. Get the inside track from real business owners just like you Since 2011 we have been arranging tailored professional indemnity insurance for Accountants.

Regulatory setting

We have a specialist knowledge of the professional indemnity market and offer a range of services to help established and new-start Accountants obtain their cover quickly and at a competitive premium. With at least 45 insurance companies on the current ICAEW list of Participating Insurers there's plenty of competition available, which is why thousands of Accountancy firms already arrange their professional indemnity insurance with these companies. We have a dedicated team looking after the PI interests of many Accountancy firms throughout the UK. Fast service quotations normally within 24 - 48 hours Dedicated Account Manager your own central point of contact High client retention 94% of clients choose to renew with us year on year. Tailored insurance designed to fit the firm Policy wordings vary, but certain protections are core to professional indemnity insurance for Accountants. The minimum premium is the insurance companies starting premium for insuring any risk. If you stop trading you may be required by your regulator to carry run-off insurance which is usually a multiple of the annual premium. It's not good practice to buy accountants' professional indemnity insurance as a 'commodity' purchased only on its price. However good the policy wording is, professional indemnity is commercial insurance and coverage disputes can still occur. Use a specialist broker to get some good advice. The insurance 'rate' is the percentage of fee income or turnover an underwriter requires to provide the insurance cover.

Minimum cover for Public Liability in many service contracts often starts at £1 million.
Professional Indemnity minimums for accountants and auditors are often set by their professional institutes.
Cyber insurance minimums in IT contracts are becoming standardized, often requiring £1-5 million cover.
Product Liability cover of £2-5 million is a common minimum for manufacturers supplying large retailers.

It is decided upon by using the usual risk factors including type of profession (accountancy, architecture, surveyor etc), the breakdown of activities, any prior claims etc. This is then applied as a percentage to a firms rateable fee income or turnover.

Insurance policies must be reviewed annually to ensure they meet updated legal minimums.
Notify your insurer immediately if your business activities change to avoid invalidating cover.
Keep all insurance certificates and policy documents accessible for inspection by authorities.
Use a broker specializing in your industry to navigate complex minimum requirement landscapes.

For example, if an underwriter decide they require a rate of 0.5% to insure an accountancy firm with a fee income of £ 500,000, the annual premium quoted will be £ 2,500 (net of insurance tax).

Region/Country	Local Regulatory Minimum PII	ACCA Requirement Applies?	Common Local Mandatory Covers
European Union (General)	Varies by member state	Yes, the higher of the two applies	Public Liability, Legal Expenses
United States	State-dependent, often $1M	Yes	Errors & Omissions, General Liability
United Arab Emirates	AED 3,000,000 for audit firms	Yes	Professional Indemnity, Medical for staff
Singapore	SGD 500,000 for public accountants	Yes	Public Liability, Work Injury Compensation
Australia	AUD 2,000,000 for SMSF auditors	Yes	Professional Indemnity (mandatory for all)

There are many different scenarios where an accountancy firm can find themselves needing to claim on their professional indemnity insurance.

Key areas of risk for Accountants

The policy must be arranged with a participating insurer that complies with approved wording. This is related to the level of cover and scope of cover against any claims made by work carried out in the last 6 years. Professional indemnity insurance (PII) is compulsory for all ICAEW members who have a practising certificate and engage in public practice. As of September 1, 2024 new regulations have come into play. Practising members generally must have a minimum indemnity limit of £2m for every single claim.

What does professional indemnity insurance cover?

Members with a gross fee income below £800,000 must have PI insurance that provides a minimum limit of indemnity equal to 2.5 times their gross fee income, with a minimum of £250,000. In case an employee gets ill or injured because of the work they do for you. A legal requirement if you have employees. In case you injure someone or damage something while providing your services. In case a customer sues you for damages because of a mistake in your work.

Joining ICPA

Protects your building from unforeseen property damage including fire, storms, floods but also arsonists and vandalism. To provide compensation if a listed event stops your business from running normally. Prices could start from around 54p per day*. Because all businesses are different, it’s difficult to give a solid figure for what you’ll be paying for insurance without speaking to a broker. Your business is unique, and price depends on a number of factors, including: Extent of cover — The more cover you opt for, the more expensive your package will likely be. Some are obvious but others are not, so here are a few real examples; Background - A firm of independent accountants were the auditors to an import company. The company was providing false information for the purpose of raising money from banks. A fraud was committed and the banks sued the auditors for failing to detect the fraud. Background - An accountant failed to inform their client that their income had exceeded the VAT threshold and they should, therefore, register for VAT.

Does PI cover advice on cryptoassets?

Your insurer — Depending on who is willing to insure you, the price for their policies will vary. Location — The location of your business is taken into consideration when calculating the cost of your premiums. Claims history — If you’ve made a claim on your policy or had claims made against you, it may affect your future premiums. *The price is for a offices and surgeries policy – 10% of customers who were sold with one of our panel providers paid £197.16 or less annually (excluding any additional administration fees) between 01/01/25 & 31/12/2025. Equivalent to £16.43 a month or £0.54 a day (and excludes the extra costs for paying monthly).

16.2 The typical sole-practitioner cost band

Your actual policy and price may vary based on your business requirements. At Bionic, we champion UK business owners and want to help in every way we can. That’s why we use a team of knowledgeable insurance brokers who work with a panel of trusted insurers to help you find coverage for your needs. Our UK-based team helps business owners daily to compare business insurance to find the right insurer that fits. Accountancy insurance could shield your professional reputation from financial and legal damages.

6.2 The composite CIOT/ATT picture

Compare insurance quotes in three simple steps Speed up the process by submitting basic business details online – whenever you have time. Schedule a call with one of our insurance brokers to discuss the details to ensure they’re correct. Get your quotes from our panel of trusted insurers and through any questions with our team. You only need a few details to get started with getting a free business insurance quote online, so it’s best to have the following information ready to go: Your name and contact details to receive your quote options You may be asked additional questions about business activities Never spoken to a business insurance broker before? Here's what you need to know: from finding one that’s right for your business, to renewals, claims and more. As a result, the client claimed against the accountant for the eventual liability. Background - A client purchased a company which turned out to be a bad investment. They claimed their accountants had been involved in the due diligence process and failed to warn them of certain fundamental issues.

ACCA Professional Indemnity Insurance (PII) regulation update