Professional Liability Insurance for Accountants
Quote and buy professional liability insurance online in minutes.
What is accountants professional liability insurance?
As a professional accountant, you have checks and balances to minimize errors and ensure you’re providing reliable service. But what happens when a client blames you for an error that causes them a financial loss? Whether or not their claim is valid, you could still be responsible for costly legal defence fees.
That’s why it’s vital for accountants to have the right coverage in place. Our accountants professional liability insurance, also known as errors and omissions (E&O) insurance, is designed to protect accountants like you from potential lawsuits, so you can operate with confidence.
If you’re a management accounting professional, you’re often called upon to make high-level recommendations and decisions that could affect the long term prosperity of an entire company. What’s more, you could also personally face legal repercussions if you’re accused of committing an error or omitting critical information during your role as a management accountant.
Interested in purchasing your professional liability online in minutes?
Acera Insurance offers EasyCover where you can get a quote, bind your policy and pay online in only a few short minutes. Get comprehensive coverage and affordable rates quickly and easily.
Here are some of the benefits of EasyCover:
- Get free online quotes 24/7
- No long, confusing applications to fill out
- Purchase and manage your policy online
- Support by phone, email or chat
- Option to bundle with other coverages
What does accountants professional liability insurance cover?
Professional liability insurance is designed to cover those who provide professional advice and services. As an accountant, you could be sued for financial damages due to an error in tax preparation or bookkeeping, or any accounting guidance you provide. As long as there wasn’t any deliberate dishonesty, criminal acts or fraud on your part, professional liability insurance could cover your legal defence costs associated with a client’s claim.
Legal expenses like these can be significant and difficult to recover from. With that in mind, it’s critical for accounting professionals to have professional liability insurance you can depend on.
How much professional liability coverage do accountants need?
In the unfortunate event that you’re sued by a client or third party related to your accounting services, our Professional liability insurance offers coverage for your legal defense expenses. Your coverage also includes any settlement or judgement awards up to your policy limit.
Our EasyCover insurance allows you to select from three levels of coverage:
- $1 million
- $2 million
- $5 million
These amounts represent the maximum amount that will be paid out for all claims over a 12-month policy period. Please note that the level of coverage you’ll need depends on your industry, clients, the value of your contracts, and potential costs of lawsuits.
For each covered claim, you will need to pay a deductible which is generally in the range of $250 to $1,500. The deductible amount is determined by your revenue. If you have two covered claims within a year for example, and your deductible is $500, you would pay $1,000 and your professional liability insurance would cover the remainder of the legal fees (up to your policy limits).
E&O Insurance for Accountants
With EasyCover by Acera Insurance, we insure the following accounting professions:
- Analysts
- Bookkeepers
(Excluding CPA, CA) - Chartered Professional Accountants
- Compliance
- Credit Controllers
- Management Accountants
- Payroll Administrators
- Regulatory reporting
- Treasury
If you don’t see your financial services profession listed here, chat with us and we’ll see what we can do!
Common claims scenarios for accountants
Tax season rush
Tax season is very busy for accountants. Mistakes can be made when under pressure and your client could end up paying more than it is owed or miss out on a refund. The client could find you liable for their financial loss.
Wrong client credit review
A financial institution decides to lend money to a client based on your review of their financial statements. A few months later the client could not pay back the debt resulting in a loss for the financial institution. You could be held responsible.
Breach of contract
Your client expects a financial report from you but you miss the deadline and cause financial loss to the company. You will most likely be held responsible.
Top factors influencing accountants professional liability insurance rates
Your insurance rates may vary compared to other accountants. This is due to a number of factors, including:
- The type and value of your accounting contracts
- The number of clients you have
- Your insurance history
- Your coverage options and limits
- If you have employees (and how many)
- The province(s) you operate in
With our EasyCover virtual tool, you can get a quote quickly online to get an idea of how much your Professional Liability Insurance will cost.
How much does E&O insurance for accountants cost?
Insurance premiums will vary based on your own specific details. For example, an entry-level CPA who makes $60,000 annually can expect to pay $743 for their errors and omissions coverage. On the other hand, a senior-level CPA with over 10 years of experience and an annual salary of $120,000, would likely pay closer to $1,287. This policy could be combined with additional coverages for increased protection at an affordable price. Commercial general liability would add $330 and cyber liability an extra $150.
Risk management for accountants
Although accountants professional liability insurance is essential for protecting your practice, proactive risk management is the best way to steer clear of costly legal disputes. Here are several practical tips to help you minimize exposure and stay focused on your work with peace of mind:
Clear Communication
For any service business, open and honest communication is imperative. Make sure all clients and employees are clear on their respective roles and responsibilities. This will help to set expectations and provide opportunities for clarification.
Record Keeping
It’s always a good idea to maintain a record of communications and regularly back up your data. Following up any in-person or phone meetings with an email or written notes will provide a record of what was discussed and any key decisions.
Quality Standards
You’ll want to ensure you have specific processes in place to deliver high quality service to your clients. This includes staying up to date on the latest accounting standards and regulations.
Why accountants trust Acera Insurance and EasyCover for their E&O coverage
Accountants throughout Canada trust us for their professional liability insurance because we’re committed to providing them with vital coverage at affordable rates. Just like the EasyCover name implies, we make it simple and quick to get the coverage you need. With our online tool, you can get a quote right away and even buy your policy in a matter of minutes. Plus, our team offers exceptional support with your insurance coverage and claims. We’re here when you need us.
We also offer additional liability coverage options for accountants.
Commercial General Liability
This standard commercial insurance helps cover expenses if a third party is hurt or has their property damaged as a result of negligence. For example if someone slips and falls in the entrance to your office. Keep in mind that CGL doesn’t cover injury to your company’s employees or property.
Cyber Liability
Cyber liability is crucial for accounting businesses of all sizes as it helps cover recovery costs after a cyber-attack or data breach. We highly recommend this coverage to assist with potential expenses for legal cost, public relations, regulatory fines and more – up to your policy limit.
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