The services you provide are vital to the management of your clients' business and personal finances. However, due to the importance and intricacy of your work there is always the chance for things to go wrong. Should a client opt to take legal action against you for a mistake there could be serious consequences; both for your business' finances and its operations. Comprehensive insurance is therefore vital.

Protecting against professional negligence

Whatever the speciality of your practice, whether it is bookkeeping, audit or taxation services, it is essential that you arrange accountants insurance, or professional indemnity insurance for accountants. This covers your business against allegations of negligence and erroneous accounting if a client is unhappy with your service or, for example, in the event of an accidental breach of client confidentiality.  Professional indemnity insurance would cover the cost of defending against these allegations as well as any damages that may be awarded against you. Furthermore, professional indemnity insurance is a regulatory requirement of most professional accountancy bodies, including the ACCA, CIMA and ICAEW.

Protecting against injury and damage claims

Public and product liability insurance is another cover which is considered essential by most client-facing accountancy practices. It protects your business from claims arising from injuries to third parties (like your clients) that may be caused on your premises or those of your clients. It also covers you for any damage done to third party property, which is vital if you visit clients in their own offices or homes.

Covering your office and its contents

All accountancy businesses that own their own building will have buildings insurance - but an often overlooked cover is business interruption insurance. It provides cover for the additional costs in working (or loss in income) in the event of an interruption to your business' activities, such as a fire or flood. Few businesses take the time to think about this cover, but it can provide vital support for your business at a time when it needs it most. For example, a fire at your office could see you having to rent an alternative premise for months; the costs involved in doing this can have a severe impact on your business' finances, so it's worth considering taking out this cover.

All accountancy businesses have office equipment that is essential for providing their service; laptops, printers and expensive financial software to name but a few. Office insurance provides cover for such equipment, which means disruption to your business will be minimised in the event of theft, accidental damage and certain disasters (including floods and fires).

If you run your accountancy business from home, you might be surprised to learn that not all home insurance policies cover business activities. As such, some home insurers may decline your claim and you could be left out of pocket. It is essential that you check and, if necessary, arrange specialist cover to ensure that your business is protected against claims.

Making a claim

If you do need to make a claim, or suspect that someone may make a claim against you, it is important that you inform your insurer at the earliest opportunity. They can guide you through the situation effectively and help get your business back to normal as soon as possible.