Accountants' guide to reviewing your professional indemnity insurance

As an accountant, you’re probably used to buying a professional indemnity (PI) insurance policy each year to protect your business. But, when was the last time you reviewed your cover? In recent years, the professional indemnity insurance market has seen challenging conditions. You may have found it easier to let your PI policy roll over from year-to-year. But 2024 is a good time to review your cover – and here are our top three considerations for your next renewal.

1. Cover type

The protection provided by PI policies can vary greatly. There are two cover types, and accountants need cover for all civil liabilities.

• Cover for all civil liabilities: This policy type covers all civil liabilities (unless specifically excluded) arising from the provision of professional services. This can include breach of statutory duty, libel and slander and breach of intellectual property rights. This is the policy type you need if you’re an accountant in the UK.
• Negligence only: A negligence-only policy is designed to cover professional negligence acts, errors or omissions only. The reduction in cover comes with a lower premium.

Next, consider how much cover you need, which will be determined by a number of factors, including:

• Contractual obligations: Do your contracts require you carry a certain level of PI insurance? You may need to maintain this level of cover for a period of time after the contract has ended.
• Contract values: The value of your contracts will influence the cover limits you need. Professional indemnity insurance brokers are there to help you consider the worst-case scenario. If you made a mistake, what would be the most your client could claim in losses?
• Cost: When deciding if a policy is right for you, it is important to consider the cost of the policy versus value for money.

An experienced broker can help you decide which PI insurance policy is best for you. Marsh Commercial's PI insurance team is here to help on 0330 8281391. If you'd rather they call you back another time – please complete an online form.

2. Use a broker that specialises in PI insurance

Due to the complexity of PI insurance, it is advisable to work with a specialist PI insurance broker. Brokers have access to a wide range of insurers and products. They shop around on your behalf to help you find the best cover at the best possible price based on your needs. Our PI team can even help you access exclusive products like the ICAEW members’ PI insurance scheme.

Using a broker is the best way to ensure you are adequately protected for the daily risks you face in your professional activities. Your broker is there to provide advice and help you decide which policy is right for you. They act on your behalf and have a legal duty of care in the advice and products provided. They will also be able to provide guidance on other types of cover you may need such as:

• Public liability: to cover claims for property damage or bodily injury that may have occurred on your business premises.
• Office insurance: to cover damage to your office premises or equipment, minimising the interruption to your business that could lead to loss of income.
• Cyber insurance: to protect against the risk of online fraud.

To help get the best solution for your PI insurance, reach out to a broker early and allow them plenty of time to work on your renewal.

3. Inform your broker of your plans to grow or diversify your business activities

Are you thinking about broadening the range of financial services you offer to your clients? Ensure you discuss any plans with your broker who will adjust your PI insurance if necessary.

Some financial services carry a higher level of risk in the eyes of your insurer. For example, offering financial advice or probate services. Offering these services to your clients may impact your premium. If you fail to update your policy - your insurance company may be unable to indemnify you in the event of a claim.

Keeping your broker informed allows you to carry out your work with confidence.

Reach out to our PI insurance team in advance of your 2024 renewal. Our experts will review your cover and aim to secure the best terms at the best possible price. If you’re a member of ICAEW, speak to us about the ICAEW members’ PI insurance scheme. You have access to an exclusive PI insurance product designed especially for ICAEW members. Contact the team on 0330 8281391, or request a phone call by completing an online form.