New ACCA PII Regulations

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• 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.

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• Insurance policies must be reviewed annually to ensure they meet updated legal minimums.
• Notify your insurer immediately if your business activities change to avoid invalidating cover.
• Keep all insurance certificates and policy documents accessible for inspection by authorities.
• Use a broker specializing in your industry to navigate complex minimum requirement landscapes.

Whilst I can't comment on the service in the event of a claim (hopefully I won't ever need to! ), for a small, private business, I cannot recommend PolicyBee high enough! Gemma provided nothing but exceptional service throughout our transition to a new policy provider. She kept us up dated and explained next steps throughout the process. With significant changes taking place in the insurance market in recent times, the ACCA have reviewed their current Professional Indemnity Insurance regulations and have endeavoured to improve and modernise these requirements to be more in-line with current trends. The new Professional Indemnity Insurance (PII) regulations will come into effect on 1st September 2023. For income up to £600,000 the PII limit must be two and a half times the firm’s relevant total income; and with a minimum limit of £100,000. If total fee income is greater than £600,000 then PII limit must be at least £1.5 million (the limits should be applied in local currency equivalents) The largest fee multiplier, of twenty-five times, has been removed from calculation of PII limits Sub-contractors must be included in PII and FGI policies Liabilities covered extended to include sub-contractors Work sub-contracted included in total income Uninsured excess restricted to £20,000 per principal Minimum PII and FGI increased from £50,000 to £100,000 High risk exposures (such as such as cyber related events, tax planning or financial services) covered on an aggregate basis New regulations on Retroactive cover and Regulated work These changes come into effect on 1st September 2023. Members will be given a 4-month period to adjust or obtain cover which is compliant with the new regulations. Renewal on or after 1st January 2024 must comply with the new requirements.

Frequently asked questions

It also sets minimum levels of PI cover, which are for ‘any one claim’, based on your business’s total yearly income: Annual income over £800,000: £2 million. Annual income less than £800,000: 2.5 times your gross fee income and not less than £250,000. However, the ICAEW warns members to think carefully about opting for less than £2 million worth of cover and potentially leaving themselves exposed. There are further minimum ICAEW insurance cover requirements for licensed firms, those authorised by the FCA to conduct insurance distribution activities, and accredited probate firms. You can find them here (under regulations 3.4-3.5).

Importance of the Policy Retroactive Date

Your PI must include at least six years’ retroactive cover to cover your past work. This is usually free to add to your policy. If you’ve been trading for less than six years, backdate cover to the date you started your business. The final requirement of ICAEW insurance is two years’ run-off cover if your business closes its doors. This ensures you’re covered if you face a claim for work you did before you ceased trading. Some of the changes implemented will be welcomed by both the insurers, brokers and members, for example the removal of the largest single fee multiplier, which often meant having to hold high limits of indemnity which was not necessarily reflective of the risk associated with the assignment nor the fees received from the work. Another positive change is the increase in the minimum limit of indemnity from £50,000 to £100,000. With the current cost of legal fees, a limit of £50,000 isn’t really enough. High risk exposures are now being allowed on an aggregate basis. This means that more insurers will be comfortable providing cover knowing that their exposure is limited, rather than declining cover all together.

• For office-based businesses, minimum often includes EL, Public Liability, and contents insurance.
• For construction contractors, minimum typically includes EL, Public Liability, and Contract Works insurance.
• For consultants, minimum often includes Professional Indemnity and Public Liability insurance.
• For retail businesses, minimum includes EL, Public Liability, and Product Liability insurance.
• For hospitality, minimum includes EL, Public Liability, and Employers' Liability.

For ACCA members it means they will have more options in the market and therefore are not left without cover or having to apply for a waiver from the ACCA which can often be a long drawn -out process.

However, the requirement for increased fidelity guarantee insurance (FGI) may limit the market for members as insurers are worried about the rise in internal fraud and therefore may not want to increase their exposure.

• 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.

The insurer may insist that the client takes out a separate Crime policy, which will cover the FGI, as they may not want to add this into their PII policy. This will potentially mean the members having to obtain two separate policies bet free bets new account to comply with the ACCA’s regulations. A surprising absence in the updated regulations is the need for members to hold cyber insurance. Cyber crime has increased exponentially and significantly affects professions such as accountants who can hold a large amount of client personal data. The cover provided under Professional Indemnity policies can be very limited and, in most cases, will not be adequate should a cyber incident occur. Yes, you will need to find out if your insurer will be updating their policy and your cover to ensure that it is compliant with the new requirements.

We can crunch the numbers

ICAS says its practising certificate holders must have professional indemnity (PI) insurance, and it also specifies how much. The required minimum levels of PI cover are for ‘any one claim’ and are based on your business’s total yearly income: Annual income over £800,000: £2 million. There are further minimum ICAS insurance cover stipulations for licensed firms and those authorised by the FCA to conduct insurance distribution activities. ICAS also wants your policy to be with an insurer from its approved list – although rest assured that the insurers we use are on there, guaranteeing you the cover you need. The final requirement for ICAS insurance is for at least two years’ worth of run-off cover if your company bet free bets no deposit or wagering stops trading.

12.6 The cost picture

This takes care of claims relating to work you did before your business closed its doors. Here’s what CIMA has to say about professional indemnity (PI) insurance: ‘As a CIMA Member in Practice (MiP) you must have professional indemnity insurance. Not only is it a mandatory requirement, it is also in your interests and that of your business to have appropriate levels of professional indemnity insurance.’ It doesn’t specify how much PI cover you should get, but it does suggest speaking to a broker for advice. In our experience, that’s a very good idea. We usually recommend buying as much PI cover as you can afford, but at least 2.5 times your annual fee income. If not, then your broker will need to find compliant cover elsewhere. A definitive reference for principals, sole practitioners, audit firms, tax specialists, R&D advisers and insolvency practitioners operating within the United Kingdom. This guide consolidates every UK accountancy body's Professional Indemnity Insurance (PII) position, sets out how regulators tie required limits to gross fee income, and walks through the high-risk specialisms — audit, tax investigation overlap, R&D credit advisory, and insolvency — where PI placement most often goes wrong.

What is the minimum run-off period for accountants?

Without it, the Health & Safety Executive can fine you £2,500 for each day you were meant to have EL but didn’t. And there’s another £1,000 fine to pay for not displaying the correct certificate. Cyber insurance provides an immediate plan bet new uk sports betting sites 2026 of action if you’re the victim of cybercrime. It includes IT rescue, compensation for lost income, and covers third-party claims if hackers steal confidential data and personal information. It’s a good idea to protect your kit too.

14.5 Looking forward

Contents insurance is for all your office equipment and pays for repair or replacement of things like computers and furniture. Portable equipment insurance covers all the bits and pieces you take around with you, like laptops and phones. From day one, we’ve focused on doing insurance better. Jargon-free documents straight to your inbox No scripts, no call centres, no phone menus. Like an “I’m insured” badge for your website. Author: Apex Insurance Brokers — UK FCA-authorised commercial broker (FRN 724952), Bristol. This guide is written for a professional readership.

PII Requirements for Non-Chartered Accountants

There’s more about pinpointing the best level of CIMA insurance for your business here. CIMA also advises members to consider run-off cover. If you close your business, it covers claims concerning work you did before you stopped trading. It provides an essential security blanket since problems and claims can take many months or even years to emerge. Accountants’ public liability (PL) insurance covers physical damage rather than financial losses.

Accountancy insurance is our speciality. We understand the risks facing accounting professionals and practices, including members of the Association of Chartered Certified Accountants (ACCA), Chartered Institute of Management Accountants (CIMA), Institute of Financial Accountants (IFA) and Association of Accounting Technicians (AAT).

It’s useful if you go out and about seeing clients, or if clients come to see you. If someone claims you caused harm to their person or property, PL covers legal costs and any compensation. It takes care of a whole range of trips, slips, falls and other unpredictable accidents. If you have staff, including part-time employees, trainees and work experience kids, then you’re required to have employers’ liability (EL) insurance by law. It pays legal expenses and compensation if staff claim they were injured or made ill by their work. Where regulators publish numerical minima or fee-income bands, the figures quoted reflect the rules in force as at the review date. PII regulations are amended periodically by each accountancy body, and firms must always read this guide alongside the current published rules of their regulator. Nothing here constitutes regulated advice — it is technical reference material to help principals brief their broker and challenge their renewal. Why accountants are a distinct PI class ATT licensed members — the tax technician position Fee-multiple sizing: ICAEW, ACCA and the worked examples The R&D tax advice claim wave Sole-practitioner economics: why small does not mean cheap Professional Indemnity is, at heart, a contract liability product layered with a tort overlay. Most professional firms are exposed to similar archetypes of claim: negligent advice, missed deadlines, conflicts of interest.