Accountants Professional Liability

Professional liability insurance protects you if a client files a malpractice claim against you. Before selecting an insurer, it’s important to assess the company’s reliability to ensure it will be there for you when you need it. It’s also essential to weigh the cost of a plan against the value it provides and be certain that any plan you purchase fully covers your practice. 

Cyber risks can be lurking in the most unsuspecting places. Members of a state professional society recently learned that the hard way. The society’s website had been compromised through a social engineering ploy, which allowed hackers to insert a Trojan virus on the site that targeted the victims. When members logged onto the “members only” area on the website, they were unknowingly giving hackers back-door access to their firms’ computer networks.

One of the more important decisions you make as an accountant pertains to your professional liability insurance. No matter how talented you are, you’re human and capable of making a mistake. When that happens, you’ll want to make sure you have adequate insurance coverage.

Every successful accounting practice needs professional liability insurance to protect the assets of the business and the personal assets and careers of those who practice there. Understanding the components of your policy and what to look for will help ensure you are adequately covered. One area that is important to understand is prior acts coverage and the retroactive date.

Not every client who walks through your door will be one with which you want to do business. Just because somebody is willing to pay for your services doesn’t mean it’s in your best interest to take on their work.

In fact, your decision to decline a client may save you money (and a lot of trouble) down the line. From the high maintenance client to the truly malicious one, some people are just not worth the added stress and risk of an accounting malpractice claim.

It’s great to have professional liability insurance that covers your day-to-day work, and if you’re settled at a firm that provides coverage, you may feel like you’re safe and protected.

There are two ways to get coverage for claims that arise outside your policy period: tail coverage and retroactive (or prior acts) coverage.
It’s important to ensure you have the right combination of these types of coverage anytime you make a change in your accounting professional liability insurance so you have the protection you need.