Accountants professional liability insurance is a type of insurance that covers professional accountants as well as small and midsize accounting firms from tax preparation risks, bookkeeping, and other professional services. Every accounting professional is entitled to the accuracy of their work for clients.
Whether you are a tax preparer, bookkeeper, or Certified Public Accountant, you are sure to encounter prospective exposures while doing business. Accountants professional liability insurance is also known as errors and omissions insurance and accountant indemnity insurance. This insurance does not only cover liabilities, but it also offers benefits as well as easier work means to make the workspace better.
This liability insurance for accounting professionals is an important insurance policy every certified public accountant, bookkeeper, and other professional accounting services should buy to cover their firm from unforeseen liabilities. This write-up contains all the information concerning this insurance.
What is Accountants Professional Liability Insurance?
Liability insurance is a type of insurance coverage specified to protect accounting professionals from the disposition of surfacing liabilities they face. It helps protect the accounting firm from losses due to negligence, omissions, and errors in professional service performance. This insurance offers an errors and omissions policy modified to cover your business needs. This insurance comes in handy to protect you from mistakes that are likely to be made when performing professional services.
Who Should Get Accountants Professional Liability Insurance?
As previously stated, professional accountants get this insurance to cover unforeseen liabilities as well as mistakes likely to occur when working on a professional service. Below are professionals who should get accountants professional liability insurance:
- Bookkeepers.
- Tax preparers.
- Accounting professionals.
- Enrolled agents.
- Small and midsized accounting firms.
If you fall under any of these categories of accounting professionals, you should purchase this liability insurance for accounting professionals.
What Does Accountants Professional Liability Insurance Cover?
This insurance covers any type of professional error likely to occur while carrying out your accounting duties. The insurance covers professional liabilities such as client lawsuits for negligence or for perceived mistakes that have been made while working.
Other issues, such as omissions and errors, professional negligence, misleading information, violations of duties and contracts, and others, are also covered under this insurance policy. If ever a professional liability claim is filed, you will be covered by your accountant’s professional liability insurance policy. All related costs and possible rewards or settlements you may be required to pay will also be covered under your insurance policy.
What Does Accountants Professional Liability Insurance Not Cover?
Professional liability insurance policies only cover claims that are related to your professional accounting duties. Just as this insurance is important for accounting professionals to get, there are others they should also purchase. For professional accounting firms that are consistently visited by partners and clients, it is a good idea to get commercial general liability coverage with your accountant’s professional liability insurance.
This insurance covers you in events where a third party sustains injuries or their properties get damaged at your firm. If your accounting firm has officers, directors, and board members, getting directors and officers insurance coverage is a good idea. This is because they are not covered under professional accounting liability insurance. However, for professional accounting firms that have more than a small number of employees, purchasing employment practice liability coverage to cover employee-filed claims is advised.
Accountants Professional Liability Insurance Benefits
Meanwhile, some benefits come with this liability insurance for accounting professionals. These benefits are added to your liability coverage to make your insurance a preferable one. Some of these benefits include:
- Security breach notification and remediation expense coverage.
- Personal fiduciary coverage.
- Pre-claim assistance.
- Also, information and network security offense coverage.
- Investment advisor coverage.
- Lastly, crisis expense reimbursement coverage.
These benefits are open to all accounting professionals who purchase professional liability insurance policy coverage for their firm.
How Much Does Accountants Professional Liability Insurance Cost?
It is one thing to purchase professional accounting liability insurance, while it is another to know how much it costs. Accounting and financing businesses pay a minimum amount of less than $35 each month on this insurance. Depending on the risks, you may pay more or less for this insurance. Based on a few factors that insurance companies consider, how much you are willing to pay for this insurance is determined. These factors include:
- Revenue.
- Accounting and finance services.
- Location.
- Business property and equipment.
- Number of employees.
After these factors have been considered, you will be informed by your insurer on how much you are to pay for accountants professional liability insurance.