ACCA's Insurance Requirements for Sole Practitioners

Failure to comply with AML regulations can have serious consequences for the

What is accountants’ insurance?

So, whether you need assistance to settle a dispute or protection for your essential tech, we’ve got your back. If you want extra legal protection our legal expenses optional extra could be the right fit for you. With this cover you’ll get a little extra help to cover the cost of settling disputes brought against your business. Get cover up to £1 million and up to £100,000 for any single claim. Most of an accountants day to day work hinges on reliable access to the tech and systems that make your job possible.

14.1 The policy backdrop

If something were to happen to the your computers you use, then business can come to a standstill. Business equipment cover helps with the cost of replacing or repairing ant lost, stolen or accidentally damaged equipment. The level of cover you need depends on the equipment you’re insurance – always make sure to accurately value your equipment to avoid underinsurance. No two policies are the same, which is why their price isn’t either. There’s no one size fits all when it comes to insurance, so if you’d like to what it would cost you to insure your business with us, the easiest way to do that is to get a quote online and see exactly what you’d pay for the types and levels of cover you’d need. offending firm, including fines and sanctions,

Audit rights

For firms, these new regulations (around anti-money laundering, register of overseas entities, probate and PII) create risks, at such time until they are embedded into business-as-usual practices. In order to minimise the likelihood of increased premiums, accountancy firms should take steps to familiarise themselves with the regulations and implement necessary changes as soon as possible. In September 2022, updates to the existing UK anti-money laundering (AML) legislation came into force. In particular, the updates made a number of amendments to the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLRs). Although many of the changes do not affect accountancy firms, there are certain areas of which they should be aware: All supervised firms are now required to perform a proliferation financing (PF) risk assessment to assess the risk that it may be used to enable proliferation financing Discrepancy reporting requirements are no longer limited to the onboarding stage of a business relationship, but have become an ongoing obligation The MLRs have been widened to apply to Limited Partnerships registered in England and Wales and Northern Ireland (Scottish Limited Partnerships are already subject to the regulations). criminal proceedings and significant reputational damage.

Pathways to Membership

They will also look at the firm’s website or they may even look deeper online into a firm’s background. Risk presentation is more important than you might think. The underwriter is assessing the professionalism and quality of your firm and if the information is badly presented, it may influence their judgement and the premium they offer or they may even decline to quote. Reading the insurance policy is an obvious necessity for any policyholder and yet it's surprising how often businesses find that they claim on an insurance policy and then discover the cover isn't as they expected because they didn't read their policy. Firms must always ensure that they have read and understand completely the terms of their professional indemnity policy.

Cover starting at £5 a month

If any points are unclear, you should clarify these points with your broker. Professional indemnity insurance operates on a 'claims made' basis which means that it is the policy in force when the claim is made that responds, not the policy in force at the time when the work leading to the claim was carried out (unless the two happen to be the same). The retroactive date within the policy is the date which determines how far back in time the insurer will respond to claims arising from past work. This is different from the renewal date which is the date of the policy inception or renewal, referring to the date when the insurance cover goes into effect. In simple terms, this means if there's a period when a business allows their professional indemnity insurance to expire, any new claims arising will be uninsured regardless of when the work was carried out.

Probate work

It's very important that the retroactive date is carefully managed as part of the policy renewal or inception. The Institute of Chartered Accountants and the ACCA have specific and strictly enforced rules which dictate the levels of cover their members must carry. Full details of the requirements can be found on their websites or by talking to a specialist broker. Taxation covers a wide area of work and is the number one cause of all professional indemnity claims against accountants. An estimated 70% of all claims relate to tax issues. Firms at the point of renewal for their PI cover

• Update the policy promptly if you change your address, as the postcode affects the risk assessment.
• Add or remove drivers from the policy as circumstances change to avoid coverage issues.
• Cancel the policy correctly through the insurer if selling or scrapping the vehicle; do not just let it lapse.
• Be aware of cooling-off periods and cancellation fees when taking out or ending a policy.
• Review the policy annually at renewal to ensure it still meets your needs and remains competitive.
• Compare quotes from different insurers to ensure you are getting suitable coverage at a fair price.

should anticipate additional scrutiny from

• Report any accident or incident to the insurer within the timeframe specified in the policy document.
• Cooperate fully with the insurer's appointed claims handler or loss adjuster during a claim.
• Do not admit liability at the scene of an accident; let the insurers handle the investigation.
• Obtain a police report for any accident involving injury, significant damage, or a hit-and-run.
• Keep detailed records and photographs of damage, the scene, and other parties involved.

insurers around the newly introduced regulations.

On 1 August 2022, the UK government introduced the register of overseas entities (ROE): a new requirement

How Apex helps

For accountants, a business insurance policy will typically be made up of several covers that give you the best coverage for all your need. Professional indemnity is the main cover of any policy for an accountant as this will cover you in the evet that your advice or services causes a client to lose money. But, you would also benefit from public liability (to help with third-party claims of accidental injury or damage_ and possibly employers’ liability if you have anyone working for you (in case they get injured or fall ill due their work). Accountants insurance is tailored to businesses like yours and, if you are a member of a Chartered Accountant Institution, it meets the standards of your professional body. With professional indemnity insurance you can choose the level of cover you need.

16.2 The typical sole-practitioner cost band

You’ll be protected from claims made against you if a client of yours loses bet uk online sports betting sites money after following your advice or using your services. Are working for a client who insists you have cover Public liability insurance protects you if someone gets accidentally injured, or their property gets accidentally damaged because of your business. This could be anything from a client having a fall in your office, to you accidentally damaging their laptop. You can set your cover level up to £10† million, though a client may ask that you have a certain level of cover before they are willing to work with you. If you’ve got anyone working for you then employer’s liability insurance is a legal requirement.

3.6 Subsidiary undertakings, networks and overseas branches

It protects your employees if they get injured on the job or fall sick because of working for you. You’re required by law to have £5 million cover, but we give you £10 million as standard. Any accountant who has people working for them is legally required to have this cover under the Employers’ Liability Act 1969. People taking part in work experience or training schemes Don’t let a claim derail your business – get Electricians’ insurance with AXA today and Future You will thank you. When you need just a little extra cover, we have optional extras that can help. for all overseas entities that own

property in the UK to record

Insurance for accountants: FAQs

Our customers’ reviews, independently moderated and managed by feefo. *The guidance is provided on behalf of AXA by Arc Legal Assistance Ltd who are authorised and regulated by the Financial Conduct Authority. †Not all occupations are eligible for £10 million coverage, the best way to find out which level of cover you are eligible for is to get a quote. Existing customers may want to consult their policy documents. New regulations have significant implications for accountants A series of new regulations, either recently introduced or due to come into force, are set to bring significant implications for the accountancy sector. information about themselves and their beneficial

owners on a new register at Companies House by 31 January 2023.

Who Is Legally Required to Have Professional Indemnity Insurance in the UK?

The list below gives an indication of where the majority of accountants professional indemnity claims come from: Low-risk - General accountancy work, personal tax returns, bookkeeping Medium-risk - Insolvency, company tax, payroll, audit High-risk - Corporate finance, financial advice, trusts, wills, tax schemes, mergers, acquisitions Probate has traditionally been a major cause of professional negligence claims against the legal profession and specialist advice should be sought by accountants who are now undertaking or who are considering adding probate to their range of services. The Assigned Risks Pool (ARP) is a facility put in place by the Institute of Chartered Accountants to provide temporary cover for their members' firms who are unable to secure professional indemnity insurance in the open market. There could be a variety of reasons why a firm is unable to obtain PI insurance. It will normally be because they have become a 'distressed risk' due to claims problems and no insurance company wants to insure them. We assist accountancy firms who have found it necessary to enter the ARP and are now looking to return to find professional indemnity insurance in the open market.

Consultants and Business Advisers

Trading without adequate professional indemnity insurance is a serious breach of regulatory requirements as well as poor business practice. A firm will be prevented from trading and closed down if they cannot obtain adequate cover. This guidance note is intended for information purposes only. Whilst all care has been taken to ensure the accuracy at the time of writing, it is not a reliable substitute for specific insurance advice. For advice about this topic, please contact us or your current brokers.

Our customers say...

This guidance note shall not be reproduced in any form without our prior permission. If a client of yours loses money because of your bad advice or improper practices, you need to be prepared to deal with a claim. Professional indemnity insurance is the main cover that accounts need. However, there are several other covers that accountant's should consider to get the most out of their cover. Yes, professional indemnity insurance is a requirement to gain memberships to many of the top professional bodies for accountants.