Understanding CPA Insurance
Being a certified public accountant (CPA) and operating an accounting business can be exciting and rewarding, but it isn’t necessarily easy. The work can be stressful, and like all business owners, you face many types of business risks. These risks cover the spectrum from office damage to liability lawsuits. That’s why you need CPA insurance, or what you might also hear referred to as accountant insurance.
CPA insurance isn’t one policy. It’s a name for several types of coverage that your business may need. The great thing about having different policies for different risks is that you can decide which policies are right for you. For instance, if you don’t have any employees and decide you don’t need workers’ compensation insurance for yourself, you can skip that purchase and save some money.
There’s excellent information on the biBerk website that can help you understand what the different types of business insurance we offer are designed to cover. You can also talk with one of our licensed insurance experts if you have questions. They’re always happy to learn about your business and recommend policies to protect you from the various risks you face.
6 Types of CPA Insurance You Should Consider
We offer six types of insurance for accountants. They are:
- CPA professional liability insurance. Also called CPA errors and omissions insurance (E&O insurance) or CPA malpractice insurance, CPA professional liability insurance is essential for CPAs and other accounting professionals. It can protect you from the cost of damages and legal fees if someone claims you made a mistake or failed to perform a service and, as a result, caused them financial harm. For instance, if you make an error in a calculation and your client suffers monetary damages as a result, CPA professional liability insurance may protect you. And it’s important to note that clients can accuse you of errors and omissions even if you haven’t made them. If that happens, your policy can still protect you from associated expenses like legal defense costs. So, CPA errors and omissions insurance is essential coverage.
- CPA general liability insurance. Also known as commercial liability insurance, this type of policy covers damages and legal costs associated with injury claims from non-employees (clients, for example), medical expenses related to these incidents, and damage to the property of others. So, if a client trips and falls at your office, breaks their wrist, and sues you, your general liability insurance policy can protect you.
- CPA business owners policy (BOP). Also called property & liability insurance, a BOP combines general liability insurance with coverage for space you lease (like an office) or property you own. It also covers business interruption and lost income as the result of property damage, as well as costs you incur to resume business operations after suffering property damage, such as the use of a temporary location. For example, imagine that a pipe bursts and floods your office. A BOP can pay many of the costs of recovering from that incident.
- CPA workers’ compensation insurance. State laws typically require this coverage for any business that has employees. It provides benefits if your employees are injured, get sick, or die due to an on-the-job incident. It can help cover medical costs, legal fees, and lost wages and can also provide a death benefit to the family of the deceased.
- CPA cyber insurance. You can purchase this type of insurance as an add-on to a BOP, general liability, or professional liability policy. It helps cover costs related to incidents where a security breach or system hack has resulted in the theft of sensitive information and fraud has occurred or there is a reasonable expectation that fraud might happen. For instance, if a hacker gets access to client bank information, your cyber insurance can cover you.
- CPA umbrella insurance. This type of insurance for accountants is sometimes called commercial umbrella insurance. It can cover costs that exceed the limit of another biBerk liability policy up to its own limit. That way, you’re not responsible for paying those costs.
Is CPA Professional Liability Insurance Required?
Obviously, you never want to operate a business without required coverage. Insurance requirements vary based on multiple factors, including your location, client expectations, etc. However, even if coverage like CPA professional liability insurance isn’t required, it’s still a good idea to get coverage.
Talk with any CPA who has chosen not to get coverage for a particular type of risk and then experienced an incident. You’ll learn that they wish they had bought a policy since it could have prevented the large financial burden they’re now trying to pay off.
New CPAs to Seasoned Professionals: Insurance for Every Stage in Your Career
If you’re just starting your CPA career, connecting with a provider of insurance for CPAs, like biBerk, can be one of the best moves you make for protecting your business financially. You get comprehensive insurance products plus guidance from our licensed insurance experts. When you work with us, you can be confident you’ve shielded your business from financial disruption resulting from lawsuits, losses, or property damage.
But biBerk isn’t just the ideal insurance advisor for new CPAs. Seasoned accountants appreciate that we’re a partner they can rely on. They know that something as simple as a client slip-and-fall accident at their office can lead to an expensive lawsuit, and they trust us to advise them on the appropriate coverage limits and other aspects of their insurance policies.
Mistakes are also a fact of life for CPAs. Despite their best efforts, they can make errors, and when they do and a client suffers a financial loss, a lawsuit may follow. But with a CPA professional liability policy backing them, an accountant can do their best work without worrying about the ever-present risk of a mistake. Then, as a seasoned CPA’s business grows or evolves, they know a quick call to biBerk can confirm their coverage is still sufficient or give them access to guidance on modifying their insurance portfolio.
Many experienced CPAs go on to start their own firms or decide to “go solo.” In either case, we’re with them every step of the way! Both ventures can be a little intimidating, but having a trusted insurance partner can ease concerns about business risks. Whether they’re renewing their coverage, changing some aspect of one of their policies, or reporting a claim, the voice of a friendly and knowledgeable biBerk insurance expert is very reassuring.
What Does CPA Insurance Cost?
As a financial professional, you understand the value of a dollar. When you get instant CPA insurance quotes for the policies you need, you’ll quickly see that biBerk offers very affordable coverage.
Our direct-to-you approach means we cut out the brokers and other intermediaries to offer policies at up to 20% less than other providers. And because you can also buy coverage, manage your policies, and report claims online whenever it’s convenient for you, you save time, too!
From Malpractice Insurance for CPAs to Business Owners Policies
Whatever types of accountant insurance you need, you can get quotes, buy policies, and have insurance in force quickly with biBerk. In most cases, your financial protection is active the day after you purchase a policy. That means you can focus on your business, confident that you’ve got a world-class insurer behind you if the unexpected occurs.