Meeting set requirements are a fact of life for some professionals, and the AAT professional indemnity insurance rules mean certain types of cover are essential for accountants which want to be part of the association. To become a member an accountant must have a set level of professional indemnity insurance, known as PII in many circles, and getting a policy need not be time consuming or difficult.
Indemnity cover is taken out not just by accountants but by all sorts of qualified professionals who offer their advice. Management consultants, private doctors, and architects often have their own policies. AAT professional indemnity insurance rules mean that this kind of cover is generally seen as a requirement for accountants.
Unsurprisingly many professionals may not be that familiar with what indemnity insurance actually does. To summarise it will pay somebody’s legal costs and even any compensation awarded against them if they face legal action. The normal legal circumstances it covers include being sued by a client because they feel you have acted inappropriately and provided advice which has harmed them in some way. The normal definition of a policy like this is that it will result in a payout if you are formally accused of making a mistake, omission, or act of negligence in your general business.
Of course mistakes can be costly for clients which is why some may be minded to seek legal action. Indemnity insurance would pay for the cost of hiring a solicitor, subject to a successful claim on the cover, and will also pay any compensation which was awarded against you if the claimant is successful.
Every policy comes with its own limit, and the AAT has its own requirements about what should be set as a minimum to fulfil its rules and regulations. Most types of cover also pay out if somebody is accused of losing or damaging important documents which belong to a client, or if an employee of a policyholder is accused of acting dishonestly, perhaps facing a claim that they have defrauded a client.
Things like public liability insurance may also be included, and the typical policy may also protect somebody in the event they are accused of defaming someone through libel, or face an allegation that they have breached confidence or copyright.
AAT professional indemnity insurance rules need not be a headache as there are many specialist providers who will supply just this kind of protection to professionals. All someone has to do is provide a little bit of information about how much protection they want, and what kind of business they are and perhaps what type of clients they deal with. It is actually often possible to get a wide number of quotes and to pick an affordable policy which matches your requirements.