Professional liability insurance for accountants and bookkeepers
A missed payroll tax deposit or a filing error can turn into a client's penalty bill, and then a claim against you. Professional liability protects accounting, bookkeeping and tax practices from the cost of those mistakes.
- Most common claim
- Penalties
- Clients seek reimbursement for IRS or state penalties tied to errors.
- Instant estimate
- $1M / $3M
- For accounting and bookkeeping firms.
- Protect past work
- Prior acts
- Keep your retroactive date when switching carriers.
Claims accounting firms face
- Tax return errors that lead to penalties and interest
- Missed payroll tax deposits or filing deadlines
- Bookkeeping mistakes that cause a client to overpay or misreport
- Advice on entity structure or deductions that a client says cost them money
What to look for in a policy
- Coverage for all services you offer: tax, bookkeeping, payroll, advisory
- Prior acts coverage back to your firm's first engagement
- Defense costs outside the limit where available
- Regulatory and board complaint defense
- A cyber policy alongside E&O for client financial data
Why claims-made matters for accountants
Tax issues often surface years after the return was filed. With claims-made coverage, a claim is covered if it's made while your policy is active and the work was done after your retroactive date. Changing carriers without keeping that date, or retiring without tail coverage, can leave years of past returns uninsured.
Frequently asked questions
Do bookkeepers need professional liability insurance?
Yes. Bookkeepers face the same kinds of claims as accountants when errors lead to penalties or misreporting.
Does professional liability cover tax penalties my client paid?
Policies typically respond to claims alleging your error caused the client's loss, which can include penalties and interest, subject to the policy terms and exclusions.
What is prior acts coverage?
Coverage for work performed before the policy started, back to a retroactive date. It's essential for firms with a long client history.
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