The Insurance Every Accountant Needs and What it Actually Covers

As an accountant, your clients rely on you to be professional, discreet, and efficient while ensuring their finances are accurately reported and keeping them legally compliant.

But what happens when things go wrong? What if you make a mistake, or your clients' data is compromised through no fault of your own?

That is when accountant insurance becomes so important. It gives you the peace of mind to do your job effectively, safe in the knowledge that your backroom processes are secured, and that you can get on with doing what you do best: crunching the numbers.

Whether working from your office or meeting clients at their premises, there is a chance that you could be the victim of cyber theft or a physical data breach if, for example, your laptop is stolen on the move.

Mistakes occasionally happen, and an unfortunate miscalculation could lead to a claim for negligence and an expensive court case. Most policies, including the accountant insurance online at nextinsurance.com, covers professional indemnity that protects you should the worst happen.

There are typically three strains of accountant insurance:

A considerable percentage of businesses take out a general liability insurance policy, which protects them in the case of a diverse array of scenarios. These include:

·    Customer injury (at your office)

·    Damage to physical property

·    Damage to intellectual property

Almost every business should look to general liability insurance as a safety measure, and accountants are no different.

If you own/rent office space and your clients visit you there, general liability insurance protects you should they trip over a carpet or loose wire, suffer an injury, and then attempt to make a claim against you. It sounds unlikely, but it does happen, and surprisingly often!

There may be instances where your clients provide you with financial data on a laptop, hard drive, USB stick, etc. General liability insurance will cover you against the cost of that physical item should it become damaged in your possession.

Where your professional negligence causes harm, you can expect a claim to be filed against you.

And this is where professional liability insurance becomes so important because it will help cover the financial costs of any lawsuit that might be forthcoming.

There's a simple difference between general and professional liability insurance: general cover protects against physical accidents and mishaps, whereas professional insurance protects against mistakes you might make in your accounting.

·    Accounting mistakes

·    Incorrect advice

·    Copyright infringement

·    Improper advertising

Cyber and data insurance

An increasingly contemporary concern for businesses that handle data is cybercrime, which can harm any firm no matter how comprehensive the security measures.

Your accounting software and systems could be hacked or compromised at any time, and cyber, and data insurance helps to protect you when information falls into the wrong hands.

Again, your professional reputation hinges on being able to keep your clients' data safe. If you are the victim of a hack – whether you could have done more or not to prevent it – your client will ultimately hold you responsible.

Cyber insurance policies will help to cover for unintentional data breaches caused by phishing and ransomware attacks, providing assurance for lost revenue and (perhaps) fines that may arise. Millions are being stolen every year, so it pays to get protection.

·    Recovering from cyberattacks – this cover protects you against fraud and in helping to recreate any data lost in the attack

·    Loss of data – this covers the costs of data lost to hackers

·    Remaining compliant – legislation about data protection is all-encompassing these days, and to stay compliant, you must have adequate insurance in place

General liability insurance should be considered the most basic level of cover for accountants because mishaps can happen when least expected.

But it's professional liability insurance that will ultimately protect your reputation and lessen the financial blow should you accidentally be negligent in your accountancy.

For operators in the financial services sector, reputation is critical – without a strong reputation, you may find work hard to come by.

A client may claim that you have made a mistake in your work, and appropriate insurance will help cover any legal fees that ensue, which will help protect your firm's future.

Remember, even the most experienced accountants will make errors – professional liability insurance is crucial in mitigating the damage to your reputation.

Ultimately, your reputation is everything as an accountant. Protect yourself with the suite of insurance policies and products that are available to you.