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Accountants
Pii Brokers provide cover that complies with the main regulatory bodies for accountants, as well as those who are either unqualified or members of an alternative regulatory body. For your reference we have listed the basic criteria required by the following regulatory bodies:-
ICA
Required Limit of Indemnity:
- Two and a half times the firm's gross fee income for past financial year, subject to a minimum of £100,000 and a maximum of £1,500,000.
Maximum Excess:
- Sole practitioners - £30,000 in the aggregate.
- Partnerships - £30,000 in the aggregate multiplied by the number of principals.
- Corporate practices - £30,000 in the aggregate or the total amount accepted by the principal as a legally binding personal obligation (but not more than £30,000 for any one principal).
Main features of rules:
- Cover to be provided via an insurer from the 'List of participating Insurers' published each year by the Institute.
- Cover must conform to the Institute 'approved wording' - a 'difference in conditions' clause must be included where cover differs.
- Retroactive cover of 6 years or establishment date of practice must be provided.
- An 'Assigned risk pool' exists for those practices unable to obtain cover.
- Run-off cover following cessation must be maintained for 2 years, but it is recommended that run-off is continued for 6 years.
ACCA
Required Limit of Indemnity:
- Fee income less/equal to £200,000 - the greater of two and a half times the firm's total income for past financial year and 25 times largest fee paid in past financial year, subject to a minimum of £50,000.
- Fee income £200,000-£700,000 - the greater of the aggregate of £300,000 and the firm's total income for past financial year and 25 times largest fee paid in past financial year.
- Fee income over £700,000 - the greater of £1,000,000 and 25 times the largest fee paid in past financial year.
Maximum Excess:
- The lesser of 2% of the limit of indemnity in respect of each and every claim or £20,000 per principal.
Main features of rules:
- Cover to be provided by 'reputable' (DTI approved) insurers.
- Cover to be on a 'civil liability' basis for each and every claim.
- Fidelity guarantee cover must be included for partners, directors and employees.
- Run-off cover following cessation of practice must be maintained for 6 years.
CIOT
Required Limit of Indemnity:
- The greater of two and a half times the firm's gross fee income for its last financial year or 25 times largest fee raised in past financial year subject to a minimum of £100,000 for a sole practitioner or £200,000 in any other case and a maximum of £1,000,000.
Maximum Excess:
- The lower of £20,000 per principal in the aggregate or 2% of the limit of indemnity.
Main features of rules:
- Cover to be provided by any EU insurers authorised by law.
- Cover to be for all 'civil liability' incurred in connection with the conduct of the business.
- Fidelity guarantee cover is 'recommended' but not compulsory.
- Run-off cover following cessation must be maintained for at least 6 years.
- Firms regulated by certain other professional bodies may be exempt from the CIOT PI requirements.
AAT
Required Limit of Indemnity:
The minimum level of cover a firm must have must be the greatest of:
- For sole traders:
- 2.5 times the firm's gross fee income and £50,000
- For partnerships:
- 2.5 times the firm's gross fee income and £100,000
- For limited companies:
- 2.5 times the firm's gross fee income and £100,000
If the gross fee income of the firm is greater than £400,000, the maximum level of PII cover required by these regulations is £1,000,000. However firms should always consider whether this is sufficient for their situation.
Maximum Excess:
- In the case of a sole trader, £10,000;
- In the case of a partnership, £10,000 per partner;
- In the case of a limited company, £10,000 per director.
Main features of rules:
Members licensed to carry out Limited Assurance Engagements must ensure that their PII covers Limited Assurance Engagements and potential third party claims.
These are minimum limits only, and we are of course able to arrange higher limits of indemnity if required.
The professional indemnity market for accountants is extremely competitive, however we have access to all of the major insurers to the profession and you will be able to benefit from our policy of reduced commissions.
To obtain a quotation please complete and return one of the proposal forms in your preferred format, or proceed from the Instant PII Quote button, available above. Alternatively if you currently have a policy simply forward a copy of your renewal submission.
Please call us if you would like to discuss your professional indemnity insurance requirements.
Our details are available on our contact page.
We look forward to hearing from you.