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Accountants

Accountant

Since 1992 KTIB has developed some excellent business relationships with accountancy firms throughout East Anglia. The reason why these relationships have lasted so well is because we understand that accountancy services require a broad spectrum of insurance covers.

We can arrange and advise on products ranging from Professional Indemnity and Legal Expenses to Private Medical and Motor Fleet.

Knowlden Titlow provide an excellent level of service and have shown that they have a good understanding of our business and the sector we operate in

Our large agency base means that we have access to many insurers and underwriting agencies as well as Lloyds of London. As we are not tied to one market, we are able to approach a range of companies to achieve the best possible terms for you.

Examples of claims

There are many scenarios which could result in a claim being made against you or your business so for your information, we have listed below some examples of actual claims which have been made. For more information on the possible exposures relating to your business, please contact us.

Reason for claim Circumstances Outcome / Settlement
Personal taxation Failure to lodge tax returns led to client losing tax repayment and interest. Cost £14,000
Personal taxation / pensions Incorrect advice provided regarding pension payments and alleged concealment of commissions. Cost £675,000
Accountancy Lender sought a reference for a business mortgage. The business failed and the subsequent property sale failed to cover the loan. Lender Cost £180,000
Trust Two partners were Trustees to a family Trust. They delegated investment authority to a company that subsequently collapsed. They also failed to minimise tax. Cost £125,000
Company tax A firm, acting as accountants to a profitable company, introduced their client to a tax mitigation consultancy. Schemes of tax mitigation were embarked upon that proved to be fraudulent from a tax perspective. Cost £130,000
Auditing Failure to spot a serious fraud due to inadequate audit procedures. The cost exceeded the limit of indemnity of £1 million
Investment advice Poor investment advice led to a serious loss to a Trust. Cost £210,000
Accountancy Confusion as to the role of an accountancy firm, whilst acting for the purchaser of a business. The purchaser thought that the accountancy firm were looking at the commercial viability of the acquisition. The firm thought that their instructions were limited to the preparation of cash flow forecasts based on given information for the purpose of raising finance. Cost £180,000
Fraud An employee in the firm stole clients' money. Cost £625,000
Insolvency Failure to realise full value of assets. Cost £110,000

The above claims examples are provided by HCC International Insurance Company Plc

Policy Cover

Wordings

Wordings should be written by an "Approved Insurer" on a minimum approved wording, often including fidelity coverage, however if you are unqualified, or qualified only to a limited extent, more basic wordings can be offered.

The usual cover

Usually the limit of indemnity will be 'any one claim' with legal costs in addition. The excess will not normally apply to insurers' costs and expenses. On a civil liability basis cover would include negligence, liability for dishonesty, liability for lost documents, libel and slander, breach of warranty of authority, etc.

The usual exclusions

Civil liability policies demand careful attention to exclusions so that non-Professional Indemnity exposures are not inadvertently covered. The following list is not definitive but typically policies will exclude:

  • Death or bodily injury unless arising from a breach of professional duty by the Insured
  • Loss or damage to physical property (but fidelity and loss of documents are covered)
  • Punitive or exemplary damages (many policies have no geographical or jurisdiction limitations)
  • North American offices
  • Liability to other insured entities
  • Nuclear risks
  • Claims and circumstances known at inception of the cover

The usual extensions

  • Fidelity
  • Loss of documents
  • Costs of representation at tribunals