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Aipedia: Company formation and secretarial agents
Usually, a formation agent's PI treats an AI-caused drafting, filing or verification error like any other professional mistake, subject to the wording. The gaps tend to be fines, AML matters, undeclared services and data breaches, which matter more as agents automate.
Part of: AI in Company formation and secretarial agents
In short
There is no statutory PI requirement for formation agents or ACSPs, and no regulator or insurer has published a statement on AI and formation agent PI. In general, PI responds to civil claims arising from the declared professional services, and many wordings may not distinguish between manual and AI-assisted work. Cover can still fall away if the services described do not include what the agent now does, such as AI identity verification or chatbot guidance. Regulatory fines, AML penalties and the agent's own losses are commonly outside PI, and data breaches usually belong with cyber cover.
PI for formation agents and company secretaries is designed to meet civil claims alleging negligence in the professional services described in the policy, including defence costs. An AI error is usually treated the same way as a human one: the question is whether the agent failed to take reasonable care, not which tool was involved. That reflects the underlying duty, which under section 13 of the Supply of Goods and Services Act 1982 is to carry out the service with reasonable care and skill.
No statutory PI requirement applies to formation agents or ACSPs, and Companies House does not set one for ACSPs. Agents within ICAEW, ACCA or SRA-regulated firms must follow those bodies' PI rules. Most PI in this sector is written on a claims-made basis, so the policy in force when a claim is made usually responds, not the one in force when the AI tool was used. That matters because secretarial errors can lie undiscovered for years. Background on the market is in company secretary PI cover and PI for company secretaries and corporate services.
The regulatory side, from the ACSP regime to AML supervision, is covered in AI in company formations: rules, risks and PI.
Claims involving AI are likely to follow the same patterns as other secretarial claims. The main sources are these:
The AI element rarely creates a new exclusion on its own, but it can make existing limits bite. The table summarises the usual position, which always depends on the wording.
| Issue | Usual PI position |
|---|---|
| AI-caused drafting or filing negligence | Commonly covered, subject to the terms |
| Service not declared, such as AI identity verification or chatbot advice | Cover may be disputed or reduced |
| AML, Companies House or other regulatory fines | Commonly excluded or uninsurable |
| Defence costs in a regulatory investigation | Sometimes covered, often with a sublimit |
| Agent's own cost of fixing its errors | Usually not covered without a mitigation extension |
| Data breach involving an AI tool or vendor | Usually a cyber matter; PI may be limited by a cyber exclusion |
| Loss of the agent's own money to a deepfake scam | Usually crime or social engineering cover |
| Dishonesty by the insured | Usually excluded |
Where one AI fault affects many clients, the aggregation clause decides whether the claims share a limit and excess. See are fines and penalties covered by PI? and cyber exclusions in PI.
No insurer has published a statement specific to formation agents and AI, but proposal forms for professional firms may ask about technology. Agents should be ready to answer questions like these:
Accurate answers matter, because a failure to disclose material facts can affect a later claim. For a cross-profession view, see does PI cover AI mistakes?.
Apex arranges PI for formation agents, company secretaries and ACSPs. A broker reviews your declared services, how the wording treats AI-assisted work and where cyber or crime cover should sit alongside it.
If the proposal form asks, answer accurately. Even if it does not, tell the insurer when you add new services, such as AI identity verification or a chatbot, because cover usually depends on the professional services described in the policy.
There is no statutory PI requirement for formation agents or ACSPs, and Companies House does not set one for ACSPs. Agents in ICAEW, ACCA or SRA-regulated firms must follow those bodies' PI rules.
Usually, subject to the wording. PI policies usually look at whether the professional service was negligent, not who or what produced the error. Some wordings may contain specific AI provisions, so check yours at renewal.
Usually the claim is made against the agent, because the client relied on the agent's service. PI may respond, subject to the wording, and the insurer may then consider whether the vendor can be pursued. Check vendor contracts for limits on the vendor's liability.
Commonly not. Regulatory fines and penalties are usually excluded or uninsurable. Some policies include defence costs for regulatory investigations, and a civil claim arising from the same facts may be covered, depending on the terms.
Tell us about your firm and the work you do. A broker will review how your current PI treats AI-assisted work, or arrange new cover. No fee for a quote. Or call 0117 325 0027.
Start a PI quote Request a callbackApex Insurance Brokers Limited is authorised and regulated by the Financial Conduct Authority. Registered in England and Wales, company number 07014570. This page is general information about how AI is used in the profession and how insurance may respond. It is not legal, regulatory or insurance advice on your circumstances, and it does not guarantee that cover will be available or on what terms.
