Professional indemnity insurance

Content Summary

Insurance is an important risk management tool for you and your business. Depending on the services you provide, some insurances are compulsory, others are your choice to make after considering your risk profile and some insurance has already been taken care of through your memberships.

Public Accountants

Professional Indemnity Insurance

If you provide public accounting services in Australia or New Zealand then you need to hold professional indemnity insurance that contains the following features:

The minimum professional indemnity insurance (PII) requirements under CPA Australia's By-Laws:

  • coverage of at least $2 million with an APRA registered insurer for members in Australia or NZ$1 million for members in New Zealand with an insurer licensed by the Reserve Bank of New Zealand
  • provision for one or more automatic reinstatements following a claim
  • provision for an excess for each and every claim
  • cover for losses arising out of dishonesty (fidelity cover)
  • indemnity for all of the Public Accounting Services that you provide
  • retroactive date no later than seven years before the beginning of the period of insurance
  • cover for everyone affiliated with the practice
  • cover for defence costs in addition to the minimum limit
  • provision for run-off cover for a period of not less than seven years.

You may also elect to obtain professional indemnity insurance with a cyber extension that will provide coverage for unauthorised or malicious data breach.

Chubb Elite Excess PII Policy

The Chubb Elite Excess Professional Indemnity Insurance Policy (Run-Off Policy) started on 23 December 2019. Run-off cover is a type of liability insurance that provides cover for work done by a business in the past.

This policy may boost eligible public practitioner’s professional indemnity insurance for public accounting services by between $2-5 million for causes of action arising from the Scheme Gap Period up to an aggregate limit of $25 million for the Period of Insurance.

The Run-Off Policy covers PAS conducted during the course of your business, but excludes the following:

  • computer consultancy or management consulting activities unless services are ancillary to other PAS
  • auditing, merger, acquisitions and business valuations of publicly listed companies
  • insurance agency
  • superannuation fund management/trusteeship
  • sealing in securities
  • financial product and investment advice, except for:
    • SMSF Services including applying for, acquiring, varying, issuing or disposing of an SMSF interest
    • SMSF establishment, contributions or pensions
    • class of product advice including superannuation products, securities, simple managed investment schemes, general insurance products, life risk insurance products and basic deposit products described in the Corporations Regulations 2001 (Cth) at s.7.6.1BA(3), 7.6.04(3), 7.8.12A(4) and 7.8.14B(3).
State or territory Period of insurance Scheme gap period
NSW 15 October 2019 to 15 October 2024
8 October 2017 to 23 December 2017
WA 15 October 2019 to 15 October 2024
8 October 2017 to 30 December 2017
QLD 15 October 2019 to 15 October 2024
8 October 2017 to 1 January 2018
ACT 15 October 2019 to 15 October 2024
8 October 2017 to 1 January 2018
NT 15 October 2019 to 15 October 2024
8 October 2017 to 18 January 2018
SA 15 October 2019 to 15 October 2024
8 October 2017 to 24 January 2018
TAS 15 October 2019 to 15 October 2024
8 October 2017 to 21 February 2018
VIC 15 October 2019 to 15 October 2024
8 October 2017 to 19 March 2018

Insurance claims

We are monitoring the insurance market and claims trends to help you manage your risk profile, reduce claims and insurance premiums. So, if you receive a claim against your professional indemnity insurance you need to let us know by providing details in the Professional Indemnity Insurance Portal. Even if you haven’t received a claim we’d like you to let us know every year as this is helpful data too.

Members guide to PIIPDF · 127.6 KB
PII fact sheetPDF · 282.3 KB
What to do if you receive a professional indemnity claimPDF · 112.4 KB

Receiving a professional indemnity insurance claim can be difficult. Read what steps you should take with this guide from Fenton Green.

Finity Consulting: 2020 market reportPDF · 4.1 MB

This report explores the potential for rate increases, changes to capacity and increased claims. It suggests that policy holders should consider the impacts of COVID-19, bushfires and climate change and review exposure. The report also suggests that policy holder’s risk mitigation should include understanding duty of care to clients, third parties and the public, and the risks of working remotely.

Contact

CPA Australia
1300 73 73 73
[email protected]

Fenton Green & co.
1300 760 123 (within Australia)
+61 3 8625 3333 (outside of Australia)
[email protected]