The Truth About Professional Liability Insurance For Accountants
Being an accountant means you are responsible in making sure that your clients face minimal risks when it comes to their finances but the fact is that the profession itself comes with a lot of risks. For businesses, they focus on property and liability risks while accountants need to have an accountant professional indemnity insurance which is also known as malpractice insurance or errors and omissions insurance.
For an accounting firm, there are many options when looking for an insurance policy. The choosing itself can be confusing that many of the firms decided to forgo getting an insurance thinking they have little risks with the practice while some of them chose the most inexpensive package.
It is best to consult a specialty insurance broker who is familiar with the industry as well as the accountant personally. This is an invaluable asset to the firm because looking for an insurance policy takes up a lot of time and can be useless at times because a broker is necessary.
Getting a specialty broker is ideal because they know about professional liability insurance for accountants and they will handle all the legal works while the client can focus on other important matters.
There are risks as an accountant and potential claims is one of them. Any mistakes in the client’s business and the accountant could take the blame no matter how good their work was. This is one of the most common problems faced with accountants, not to mention the fees included such as getting an expert witness, attorney fees and claim payments.
There are big improvements in accountant professional indemnity insurance but the fact is not all policies are the same. The rule of thumb is that you get the coverage depending on how much you have paid. There are many providers in the market but it is important to choose one that will cover all your bases. The insurance business determines the risks based on the revenue that is earned by the specific CPA firm as well as other contributing factors including claims, location, areas of practice, clientele and number of practitioners.