Wiki — Renewal advice · Accountants

Renewal preparation for ICAEW, ACCA and AAT-regulated accountancy firms. The document you send to your broker in the six weeks before renewal shapes almost everything that follows — the number of insurers who will quote, the terms they offer, and the conversation you have if a claim later arrives.

Minimum PI requirements by regulator

All three main accountancy regulators impose a minimum PI requirement. The detail varies:

• ICAEW — cover of the greater of two and a half times gross fee income or a fixed minimum, subject to an overall maximum limit. The Institute's PII Regulations set the wording standards including dishonesty of employees and defence-costs treatment.
• ACCA — a formula linked to fee income with a minimum figure for smaller firms and an upper figure for larger ones, together with specified extensions and a claims-made basis.
• AAT — for licensed accountants, a minimum limit tied to income with prescribed cover extensions and run-off requirements.

The regulator sets the floor. Firms should treat that floor as a minimum, not a target, and buy the limit their client base and risk profile warrant.

The renewal proposal — what underwriters need to see

A well-presented renewal proposal makes the difference between a competitive quote and no quote at all. The core content:

• Firm details. Legal entity, offices, principals, headcount split (partners, qualified staff, other), regulator and licence number.
• Fee income. Last complete year and current-year estimate, ideally split by service line — audit, tax, insolvency, corporate finance, R&D claims, bookkeeping and compliance, forensic, advisory.
• Client base. The size profile of clients (owner-managed, mid-market, listed), sector concentration, largest client as a percentage of fees, any single client above 10% of fees.
• Higher-risk work. Tax mitigation schemes (historic or current), R&D tax credit work, insolvency appointments, work for regulated entities, cryptocurrency clients, any US-connected work.
• Claims and circumstances. A full disclosure for the last six years — every claim, every circumstance, whether closed or open, whether paid or not.
• Risk management. Engagement letter discipline, peer review, quality control procedures, professional standards compliance.

The Insurance Act 2015 disclosure duty at renewal

The Insurance Act 2015 duty of fair presentation applies at every renewal, not just at inception. That means every material circumstance known to the firm — including any change during the expiring year — must be disclosed in a manner reasonably clear and accessible to a prudent underwriter. Common omissions that later create problems:

• A partner who left mid-year without any run-off arrangement for their personal exposure.
• A client complaint that was resolved without a formal claim but might resurface.
• A change in the mix of work — for example a new insolvency appointment or a first R&D claim engagement — that was not disclosed at inception because it started mid-year.
• A regulatory review, monitoring visit or professional-body enquiry.

Disclose them at renewal even if disclosed already mid-term. Underwriters would rather see the same fact twice than not at all.

Higher-risk work and how to present it

Some activities attract closer underwriting attention because loss experience has been higher across the market:

• Tax mitigation schemes. Whether current or purely historic, disclose the volume of work done, the years, the schemes involved (by generic type — not client names), any HMRC challenges, and any resulting claims.
• R&D tax credit work. Volume, average claim size, sectors served, quality control on claim preparation, exposure to HMRC enquiry and rejection.
• Insolvency. Number of live appointments, split of administrations, CVAs, liquidations and IVAs, any Court challenges, any complaints to the RPB.
• Cryptocurrency and digital asset work. Any clients where the firm has advised on tax treatment, done bookkeeping, or acted as auditor.

Presenting higher-risk work well — the volume, the controls around it, the loss experience — often produces a better outcome than trying to soften or downplay it.

Practical steps in the six weeks before renewal

1. Week 6. Confirm the fee income figures with the finance function. Agree the current-year estimate with the partners.
2. Week 5. Compile the six-year claims and circumstances register. Draft the disclosure narrative for each.
3. Week 4. Complete the proposal. Have it reviewed by a partner before it goes to the broker.
4. Week 3. Broker takes the proposal to the market. Underwriters come back with questions.
5. Week 2. Quotes received. Compare terms, wordings, excesses and price. Discuss any exclusions.
6. Week 1. Instruct the broker to bind. Read the schedule and confirm the details are correct.

Run-off — the standing consideration

Every renewal is also a moment to consider run-off. If the firm were to close during the coming year, the primary insurer would generally offer run-off cover priced against the exposure. Firms considering succession, sale or wind-down should raise the point at renewal so the broker can factor it into the placement decision — some insurers price run-off more competitively than others, and knowing that in advance shapes the choice of primary carrier.