Here are some frequently asked questions by CPAs regarding Professional Liability insurance.
- What does Professional Liability cover me for?
- It covers you for claims made by your clients against you or your firm for services rendered by you.
- How much does Professional Liability insurance cost?
- Price is determined primarily by your gross revenue on an annual basis, then other factors are weighed, such as, how many professionals give advice, what internal controls you have in place, if you have any claims, and what limits and deductible your firm needs.
- How much Professional Liability coverage do I need?
- A general rule of thumb is to get limits in excess of what you gross annually, but other factors come into play, such as your personal assets that you want to protect, what exposures you have for the type of work you do, what net worth do your clients have, etc.
- How does Professional Liability insurance work?
- When you first start with coverage, your policy will cover you for services rendered on a going forward basis. Each year you renew, your policy will cover you for services rendered from your initial start date (prior-acts date or retroactive date). Premiums are initially discounted by approximately 50% since the carriers do not expect to see a claim for a few years. Your premiums “step up” until the mature year when you reach the actual 100% premium level.
- Who do I contact if I have any questions regarding my Professional Liability policy?
- You can always call us or use your desktop or smartphone to access our website. You will also have access to Claims Representatives, Subpoena Experts, and Risk Management Professionals depending on your circumstances.
- What do I need to look for in a Professional Liability Program?
- Does the carrier have Risk Management Support which can be critical to get your issues addressed in a timely manner? Does the carrier have experienced counsel at reasonable rates? If not, will I be blowing through my deductible quickly? Is the Program affordable overall, not just the premium but all components? Has the carrier shown a commitment to the profession by offering years of continuous coverage? Many carriers get in, collect premiums, then get out and move onto something else. All of these issues must be evaluated and considered.
If you have any further questions, please feel free to leave them in the comments section below or contact us directly at 888-512-8878.