A recent consultation launched by the Institute of Chartered Accountants in England and Wales (ICAEW) on proposed changes to their professional indemnity insurance (PII) arrangements will be of interest to Chartered Accountants Ireland members and firms. PII arrangements are developed jointly by the three bodies, Chartered Accountants Ireland (the Institute), ICAEW and the Institute of Chartered Accountants of Scotland, and any resulting changes may impact Institute firms.
Although amendments have taken place periodically, a wide-ranging review of all the PII arrangements has not taken place for some time and the current limits of insurance have not changed since 2008. Several issues have necessitated the need for review of PII arrangements including:
- The changing nature of the structure of firms and their insurance arrangements;
- financial capacity of members and entities to retain (self-insure) risk;
- pressure to manage the cost of insurance; and
- an increase in firms unable to source qualifying insurance.
ICAEW have conducted a review of the requirements with the aim of ensuring they remain fit for purpose and provide adequate protection to the public and to firms while being mindful of the cost and availability of insurance to the profession and are consulting on proposed changes to same. This consultation follows a call for evidence launched earlier in the year to gain a better understanding of issues faced in the insurance market.
A summary of the proposed changes and the consultation document are available here. The principles have the support of the Institute’s Professional Standards Board.
We encourage members to read the consultation document prepared by ICAEW in full. Institute firms can respond to the consultation as set out at the link above (and need not complete any questions which are specific to ICAEW members/firms only), or alternatively, can provide comments on any aspects of the consultation or on the Institute’s PII requirements generally, by email to Professionalstandards@charteredaccountants.ie.
The consultation period will run until 14 December 2023.
The Institute’s PII requirements are set out in Chapter 7 of the Public Practice Regulations.
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