Accountant? You'll need insurance!

Imagine, that in these difficult economic times, accountants in the UK are being held in the highest regard as one of the most trusted resources for advice for the majority of those in need of financial advice or management. Trust in banks, lawyers and other financial sources has plummeted according to a recent survey, but an accountant is viewed as a reliable and trusted friend.

As an accountant, you know that the responsibility of handling the finances of individuals or other businesses can be risky, and you can be vulnerable to the effects of poorly given advice or mistakes. That's why insurance for accountants can be complicated, and they need to do their homework by researching online to learn what types of insurance will best serve them and create a tailored package that will meet their needs.

Accountants need a variety of insurance cover. Let's start with Professional Indemnity Insurance. If your client should suffer a financial loss because of advice you gave him, Professional Indemnity Insurance will likely cover the claim made against you as well as the legal expenses. In many cases, clients will ask if you have Professional Indemnity Insurance and will only sign on with you if you do. Most insurance companies that provide Professional Indemnity Insurance offer cover up to £5 million.

Professional Indemnity Insurance will cover you for negligence should you give the wrong advice or make a mistake in your accounting work. If a claim happens because of a civil liability against a client, you will likely be covered. If you caused an infringement of intellectual property rights such as a trademark or copyright, you will likely be covered. Should a client's documents be stolen, lost or damaged whilst in your care, you will likely be covered. Depending upon the policy you choose, you may also be protected from your own personal losses caused by a dishonest employee or freelancer contracted by you and under your supervision.

You, as an accountant, may feel totally confident in the work you produce, but because you are providing a professional service, any client can challenge your work, and you are vulnerable to a claim if you've failed to meet a client's expectations and cause financial loss. There is really no exception to the rule when it comes to Professional Indemnity Insurance for accountants. It is absolutely essential if you are to protect your clients, your business and your peace of mind.

Public Liability Insurance is also a necessity for an accountant, because you come in contact with members of the public all of the time. Public Liability will cover you should you cause damage to a person or their property or cause injury to them whilst you are working. No matter how hard you try, an accident can happen to someone as a result of your business, and a claim can be filed for something as minor as spilling water on a client's computer. And, any employee's actions whilst at work cause an injury to a member of the public or a client, a Public Liability claim can be filed against your business. Most Public Liability Insurance policies can be purchased as a separate policy or part of a package that includes other cover like Employers' Liability Insurance and Product Liability Insurance.

Employers' Liability Insurance is necessary if you employ one or more people in your business. You are legally obliged to have Employers' Liability Insurance if you have a staff, no matter how big or small. It is a requirement that an employer has at least £5 million of cover in place. This insurance protects you and your accounting business against any claim that is brought against you by an employee who is injured or becomes ill whilst employed or if the employee can trace the illness back to your business as the cause of that illness. That's why it's important to have detailed records of all current and past employees including temporary workers, part-time workers, sub-contracted workers, students and volunteers.

You must have a certificate proving you have Employers' Liability. This certificate must be placed in a spot where all employees or visiting inspectors can read it. If you fail to produce this certificate, you can face fines of up £2,500 for every day without it. Employers' Liability will likely cover the cost of the claim brought against you, as well as any award to an employee should a case go against you as well as any legal fees incurred. Because there are some exemptions to Employers' Liability Insurance like employing family members, it is wise to study Employers' Liability policies on Internet websites that are dedicated to insurance for professional people.  

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