New ACCA PII Regulations

Professional indemnity insurance policies operate on a ‘claims made’ basis – this means that the policy to respond will be the one in place at the time the claim is made, rather than when the negligence occurred. So, for example, if a client makes a claim against you tomorrow for alleged negligent advice given in 2017, then it will be the policy you currently have in place which will respond to claim. In general, a claimant has 6 years to make a claim against you from the date they have suffered the financial loss. However, in some instances, there is a possibility of bringing a claim after the primary limitation period – this is known as the secondary limitation period and gives an additional 3 years from the date the claimant first become aware of the negligence. If it is discovered that negligent advice had been provided from a professional over 15 years ago then there may not be a possibility to pursue a claim. There are some exceptions to this rule, for example if someone has deliberately concealed evidence or relevant facts then there could be an additional 6 years added. If the negligent act involves a minor, then they may also have additional time from when they reach 18 regardless of the 15 year rule. It is important that this is discussed and forms part of sales agreement.

2. The UK accountancy regulatory map

ICAEW Chartered and ACCA Chartered Certified accountants and regulated firms are obligated to hold professional indemnity insurance (PII)—in fact, membership with these organisations is dependent upon having qualifying PII cover in place. Chartered accounts must ensure they are covered by PII that: meets the rules for minimum limits of cover Chartered accountants working for a practice or a private company will not need to buy their own PII, as their employer will provide this cover for them. But chartered accountants who have set up their own business must abide by the PII regulations. In addition to PII, any accountant running their own business needs additional types of business insurance to cover operational risks. You can learn more about how these coverages work in our concise guide to accountant insurance.

11.2 Worked examples — five fee tiers

For more information on insuring your car properly if you're an accountant, read our article "What Car Insurance Does an Accountant Need?" The amount of PII a chartered accountant needs is determined by their professional body based on fee income and the nature of their work. In 2026, the current binding minimum levels of cover for small practices are £100,000 for ACCA members and £250,000 for ICAEW members. It is important to note that these are absolute baselines; most firms are required to hold significantly higher indemnity limits[symbol:-dash]often up to £2 million[symbol:-dash]calculated as a multiple of their gross fee income to ensure adequate protection against modern litigation risks. Whether an accountant is chartered or not, if they retire or take a break from work they'll still need a form of PII to protect them in case a claim against them arises later on. Claims can be brought up to six years from the time the work occurred, so accountants need to buy run-off cover for six years. As a seller, by maintaining your own run-off insurance you can be assured that you have cover for your past liabilities and are not dependant on someone else maintaining this cover for you. Compensation can still be recoverable for negligence against a firm who has become insolvent. The Third Party (Rights Against Insurers) Act 2010, came into force in August 2016.

• Insurance requirements can be stipulated in the Articles of Association for limited companies.
• Shareholders' agreements may mandate specific Directors' and Officers' Liability cover levels.
• Bank loans or financing agreements often require asset and key person insurance as collateral.
• Landlord lease agreements frequently require tenants to have Public Liability insurance.

Claims that arise after a practice has been placed into run-off are no different to claims that could have arisen when the practice was still trading - it is just a matter of when the negligence/loss is discovered.

What claims actually look like

The Third Party (Rights Against Insurers) Act 2010, came into force in August 2016. Claims that arise after a practice has been placed into run-off are no different to claims that could have arisen when the practice was still trading - it is just a matter of when the negligence/loss is discovered. A few examples of work that might have been carried out before a practice ceased but where the possible claim has not yet come to light are: Surveyors may be at risk where underlying subsidence doesn’t materialise visibly for several years. Accountants may be at risk where an error in CGT calculations doesn’t transpire until a HMRC investigation commences. Solicitors may be at risk because they didn’t identify the correct title boundary which doesn’t come to light until the property is sold on.

What are the regulatory requirements?

An architect’s plans may seem perfectly acceptable until fractures start to appear later down the line and the building starts falling down! Remember, if there is no Professional Indemnity cover in place when the claim is first made, then you will have no alternative other than to fund any legal advice, defence costs or losses incurred yourself which can not only be expensive but time consuming and very stressful. Depending on their qualifications, an accountant may or may not be obligated to have professional indemnity insurance. Regardless, professional indemnity insurance is very important for anyone working as an accountant. And if you're running your own accountancy business, there are other types of insurance you may need as well. A few examples of work that might have been carried out before a practice ceased but where the possible claim has not yet come to light are: Surveyors may be at risk where underlying subsidence doesn’t materialise visibly for several years. Accountants may be at risk where an error in CGT calculations doesn’t transpire until a HMRC investigation commences. Solicitors may be at risk because they didn’t identify the correct title boundary which doesn’t come to light until the property is sold on. An architect’s plans may seem perfectly acceptable until fractures start to appear later down the line and the building starts falling down! Remember, if there is no Professional Indemnity cover in place when the claim is first made, then you will have no alternative other than to fund any legal advice, defence costs or losses incurred yourself which can not only be expensive but time consuming and very stressful. Depending on their qualifications, an accountant may or may not be obligated to have professional indemnity insurance. Regardless, professional indemnity insurance is very important for anyone working as an accountant. And if you're running your own accountancy business, there are other types of insurance you may need as well. Many accountants start their careers at a large accountancy practice, then leave (with or without having become a chartered accountant) to set up shop on their own. Non-chartered accountants can set up a very successful small business, working to provide professional accountancy and taxation assistance to individuals or other small businesses.

Annual Client Turnover (GBP)	Minimum PII Limit (GBP)	Aggregate or Any One Claim?	Typical Excess (GBP)
Up to 500,000	500,000	Aggregate	1,000 - 2,500
500,001 - 2,000,000	1,000,000	Any One Claim	2,500 - 5,000
2,000,001 - 5,000,000	1,500,000	Any One Claim	5,000 - 7,500
5,000,001+	2,500,000+	Any One Claim	7,500+

A non-charted accountant will not be authorised to carry out any audit, insolvency, investment business and probate activities, but they can have a very active business engaged in payroll, VAT and bookkeeping activities as well as producing annual accounts for businesses. Non-chartered accountants who run their own accountancy business are under no obligation to hold PII, since they're not members of the organisations that require it (e.g., ICAEW, ACCA)—but PII is still essential to protect an accountancy business and even personal assets. In fact, PII is critical for accountants operating as sole traders because they do not have the protection of a company.

Run-off cover — easy to ignore, expensive to forget

(If you bought your policy through us you can be sure it is.) All institute-approved policy wordings are basically the same, regardless of which insurer underwrites it. The insurer must highlight any changes they've made to the wording with a 'difference in conditions' clause. The rules are quite simple: your level of cover has to be at least two and a half times your firm's gross fee income for the past financial year. The minimum level of cover is £250,000. If your firm has a gross income of over £800,000, then you need to have at least £2m cover.

What is the insurance 'rate'?

For probate firms, the minimum cover is £500,000 for any one claim. This means that your cover has to be enough to cover a claim of this amount. For firms involved in insurance distribution activities, the structure changes slightly. They need to have the minimum level of cover prescribed to them by the FCA. A maximum excess is also important when it comes to accountants' professional indemnity insurance requirements. If an uninsured accountant is sued for negligence by a client, their personal finances may be at risk—their home, savings, retirement investments and more. PII protects accountants if they're sued by a client for negligence by covering legal defence costs as well as settlement payments. So while PII might not be required for non-chartered accountants, it bet best betting apps with free bonus is still a crucial aspect of risk management for any working accountant. For information on how much PII cover you should have as a non-chartered accountant, see our updated 2026 guide and tables for chartered accountants here. These tables reflect the current 2026 regulatory thresholds and serve as an essential benchmark for determining adequate coverage levels even if you are not governed by the ICAEW or ACCA. ICAEW Chartered and ACCA Chartered Certified accountants and regulated firms are obligated to hold professional indemnity insurance (PII)—in fact, membership with these organisations is dependent upon having qualifying PII cover in place. Chartered accounts must ensure they are covered by PII that: meets the rules for minimum limits of cover Chartered accountants working for a practice or a private company will not need to buy their own PII, as their employer will provide this cover for them. But chartered accountants who have set up their own business must abide by the PII regulations. In addition to PII, any accountant running their own business needs additional types of business insurance to cover operational risks.

• Public Liability insurance is not a legal minimum but is often required for contracts and leases.
• Professional Indemnity insurance is a legal requirement for certain professions like financial advisors.
• Motor insurance is a legal minimum for any company vehicles, with at least third-party cover.
• Product Liability insurance may be required if you manufacture, supply, or repair goods.
• Directors' and Officers' Liability insurance is not legally required but is critical for risk management.

You can learn more about how these coverages work in our concise guide to accountant insurance.

How to Access Our PI Insurance

Many accountants start their careers at a large accountancy practice, then leave (with or without having become a chartered accountant) to set up shop on their own. Non-chartered accountants can set up a very successful small business, working to provide professional accountancy and taxation assistance to individuals or other small businesses. A non-charted accountant will not be authorised to carry out any audit, insolvency, investment business and probate activities, but they can have a very active business engaged in payroll, VAT and bookkeeping activities as well as producing annual accounts for businesses. Non-chartered accountants who run their own accountancy business are under no obligation to hold PII, since they're not members of the organisations that require it (e.g., ICAEW, ACCA)—but PII is still essential to protect an accountancy business and even personal assets. In fact, PII is critical for accountants operating as sole traders because they do not have the protection of a company.

Legal Expenses Insurance for Accountants

If an uninsured accountant is sued for negligence by a client, their personal finances may be at risk—their home, savings, retirement investments and more. PII protects accountants if they're sued by a client for negligence by covering legal defence costs as well as settlement payments. So while PII might not be required for non-chartered accountants, it bet best betting apps with free bonus is still a crucial aspect of risk management for any working accountant. For information on how much PII cover you should have as a non-chartered accountant, see our updated 2026 guide and tables for chartered accountants here. These tables reflect the current 2026 regulatory thresholds and serve as an essential benchmark for determining adequate coverage levels even if you are not governed by the ICAEW or ACCA. For more information on insuring your car properly if you're an accountant, read our article "What Car Insurance Does an Accountant Need?" The amount of PII a chartered accountant needs is determined by their professional body based on fee income and the nature of their work. In 2026, the current binding minimum levels of cover for small practices are £100,000 for ACCA members and £250,000 for ICAEW members. It is important to note that these are absolute baselines; most firms are required to hold significantly higher indemnity limits[symbol:-dash]often up to £2 million[symbol:-dash]calculated as a multiple of their gross fee income to ensure adequate protection against modern litigation risks. Whether an accountant is chartered or not, if they retire or take a break from work they'll still need a form of PII to protect them in case a claim against them arises later on. Claims can be brought up to six years from the time the work occurred, so accountants need to buy run-off cover for six years. Run-off cover for accountants is professional liability insurance that a business or person uses after they stop trading. It protects against claims made against bet free bet no deposit online casino work done earlier, while the business was still actively trading (and fully insured). Run-off cover is typically cheaper than full PII because there's a lower risk of claims as time passes.

• When hiring subcontractors, ensure they hold their own EL insurance to avoid liability transferring to you.
• For joint ventures, a project-specific insurance package meeting all parties' minimums is often required.
• When working overseas, local statutory insurance minimums must be met, which can differ significantly.
• For mergers and acquisitions, due diligence must verify all target company insurance meets legal minimums.
• Temporary event insurance must meet local authority requirements for public safety and liability.

Most problems will have arisen closer to the time of the work, and the further away you get, the less chance you have of a claim. Rated 4.7 out of 5 stars on Reviews.co.uk If you're a chartered or certified accountant, or a member of a professional accountancy association, you'll know that there are certain accountants' insurance requirements you must meet. Did you also know that accountants' professional indemnity insurance requirements specify a minimum level of cover? And that you need to keep your insurance going for a certain number of years? First of all, you need to make sure your policy is from a 'participating insurer'. If it is, you can rest assured it meets the minimum requirements of the ICAEW's approved wording. Check your insurer is on the list by clicking here.

FAQs on Professional Indemnity Insurance for Accountants

Professional indemnity insurance policies operate on a ‘claims made’ basis – this means that the policy to respond will be the one in place at the time the claim is made, rather than when the negligence occurred. So, for example, if a client makes a claim against you tomorrow for alleged negligent advice given in 2017, then it will be the policy you currently have in place which will respond to claim. In general, a claimant has 6 years to make a claim against you from the date they have suffered the financial loss. However, in some instances, there is a possibility of bringing a claim after the primary limitation period – this is known as the secondary limitation period and gives an additional 3 years from the date the claimant first become aware of the negligence. If it is discovered that negligent advice had been provided from a professional over 15 years ago then there may not be a possibility to pursue a claim.

Is professional indemnity insurance mandatory for chartered accountants?

There are some exceptions to this rule, for example if someone has deliberately concealed evidence or relevant facts then there could be an additional 6 years added. If the negligent act involves a minor, then they may also have additional time from when they reach 18 regardless of the 15 year rule. It is important that this is discussed and forms part of sales agreement. As a seller, by maintaining your own run-off insurance you can be assured that you have cover for your past liabilities and are not dependant on someone else maintaining this cover for you. Compensation can still be recoverable for negligence against a firm who has become insolvent. (If you bought your policy through us you can be sure it is.) All institute-approved policy wordings are basically the same, regardless of which insurer underwrites it. The insurer must highlight any changes they've made to the wording with a 'difference in conditions' clause. The rules are quite simple: your level of cover has to be at least two and a half times your firm's gross fee income for the past financial year.

Summary of 2026 Accountant Insurance Requirements

Run-off cover for accountants is professional liability insurance that a business or person uses after they stop trading. It protects against claims made against bet free bet no deposit online casino work done earlier, while the business was still actively trading (and fully insured). Run-off cover is typically cheaper than full PII because there's a lower risk of claims as time passes. Most problems will have arisen closer to the time of the work, and the further away you get, the less chance you have of a claim. Rated 4.7 out of 5 stars on Reviews.co.uk If you're a chartered or certified accountant, or a member of a professional accountancy association, you'll know that there are certain accountants' insurance requirements you must meet.

1.2 Reliance by third parties

Did you also know that accountants' professional indemnity insurance requirements specify a minimum level of cover? And that you need to keep your insurance going for a certain number of years? First of all, you need to make sure your policy is from a 'participating insurer'. If it is, you can rest assured it meets the minimum requirements of the ICAEW's approved wording. Check your insurer is on the list by clicking here. The minimum level of cover is £250,000. If your firm has a gross income of over £800,000, then you need to have at least £2m cover.

PII Limits for a Chartered Accountant

The 'excess' is the amount that you have to pay if you claim, while the 'aggregate excess' is the total of all claims paid in a policy year. According to the ICAEW, the maximum aggregate excess for accountancy firms should not exceed £3,000 or 3% of a firm's gross fee income (whichever is higher). Smaller accountancy firms, with a gross fee income of less than £100,000, are permitted an aggregate excess of no more than £3,000. You need to make sure your policy has retroactive cover (insurance jargon for backdated cover) of at least six years. If your business hasn't been going for at least six years, cover should be backdated to when your practice started.

Professional indemnity insurance

Finally, if and when you decide to call it a day, accountants' professional indemnity insurance requirements mean you'll need to have run-off cover for at least two years (although we'd recommend six years just to be on the safe side). If you're wondering, run-off cover is for claims made against you after you've stopped trading but which relate to work you did when your business was up and running. Put simply, the liability for your work exists even when your company doesn't and run-off is what's needed to cover it. For probate firms, the minimum cover is £500,000 for any one claim. This means that your cover has to be enough to cover a claim of this amount. For firms involved in insurance distribution activities, the structure changes slightly. They need to have the minimum level of cover prescribed to them by the FCA. A maximum excess is also important when it comes to accountants' professional indemnity insurance requirements. The 'excess' is the amount that you have to pay if you claim, while the 'aggregate excess' is the total of all claims paid in a policy year. According to the ICAEW, the maximum aggregate excess for accountancy firms should not exceed £3,000 or 3% of a firm's gross fee income (whichever is higher). Smaller accountancy firms, with a gross fee income of less than £100,000, are permitted an aggregate excess of no more than £3,000. You need to make sure your policy has retroactive cover (insurance jargon for backdated cover) of at least six years. If your business hasn't been going for at least six years, cover should be backdated to when your practice started. Finally, if and when you decide to call it a day, accountants' professional indemnity insurance requirements mean you'll need to have run-off cover for at least two years (although we'd recommend six years just to be on the safe side). If you're wondering, run-off cover is for claims made against you after you've stopped trading but which relate to work you did when your business was up and running.

• UK employers must have Employers' Liability (EL) insurance with a minimum cover of £5 million.
• The EL certificate must be displayed at each business premises where employees work.
• Insurance must be provided by an authorised insurer under the Financial Services and Markets Act 2000.
• Cover is required for all employees, including temporary, casual, and contracted staff.
• Certain businesses, like family businesses with no direct employees, may be exempt.
• Failure to have EL insurance can result in fines of up to £2,500 per day.

Put simply, the liability for your work exists even when your company doesn't and run-off is what's needed to cover it.