Accountants are vulnerable to legal liability claims due to the sensitive nature of the information with which they work. Claims of negligence or fraud can result in legal charges against the accountant as well as their employer. Clients’ mistakes can even put the accountant at risk for damaging legal situations.
What Are the Professional Risks for Accountants?
Accuracy and integrity are essential traits for an accountant to possess, but mistakes can sometimes happen. Misunderstandings and claims of mismanagement can also escalate into damaging lawsuits. Your company can even find itself in the midst of litigation without doing anything wrong. Claims examples include:
- Errors or omissions, leading to clients’ financial loss
- Breach of duty
- Negligence or failure to use reasonable care
The costs involved in defending a lawsuit can be devastating to your business. Accountant legal liability insurance is critical for every accounting firm.
How Can Liability Insurance Protect Your Company?
Professional liability insurance protects your company and your employees against claims based on professional duties and advice. If you or your firm are named in a lawsuit, the defense costs are covered in a professional liability package. Without this protection, the firm is vulnerable to damages that could put the company at great risk.
Accountant liability insurance gives you peace of mind knowing that you are protected against mistakes and malicious intent.