ICAEW · PII reforms

ICAEW proposed PII reforms 2027 — Bye-law 61

Q: Are the reforms confirmed?

Not yet — consultation stage. Timeline suggests effective mid-2027 to early 2028.

Q: Will my premium go up?

For firms below the current floor, yes. For mid-range firms, depends on how multiplier changes.

Q: What about ACCA?

ACCA typically follows similar principles but has independent regulatory framework. Consult ACCA guidance.

Q: Does this affect audit-registered firms differently?

Yes — audit-registered firms already carry higher cover; reforms may standardise this.

Q: How can I input to the reforms?

Via ICAEW consultation channels or through Law Society-equivalent representative bodies for accountants.

Q: Should I increase cover in advance?

Consider it — voluntary uplift may make the mandatory transition smoother.

Reviewed by Matthew Bartlett, Director, Apex Insurance Brokers Limited · Published 15 July 2026

ICAEW periodically reviews Bye-law 61 — the framework governing chartered accountants' PII. Proposed 2027 reforms consider the 2.5× formula, aggregate limits, and audit-specific requirements.

The current framework

Bye-law 61 requires 2.5× annual gross fee income as aggregate PII cover.

Floor: £1.5m minimum for the smallest practices.

Cap: £25m maximum requirement under the Bye-law.

Applies to firms in public practice; audit-registered firms have additional considerations.

Cap and formula have not been materially revised since the mid-2010s.

What the 2027 review is expected to consider

Whether the 2.5× multiplier remains appropriate given inflation and claim trends.
Whether the £1.5m floor should rise to reflect real-terms minimum cover value.
Whether the £25m cap should be lifted given larger firms' exposure profile.
Audit-registered firm minimum consideration — separate from Bye-law 61.
Run-off period extension — currently 2 years, potentially extending.
Alignment with FRC audit-firm standards.

Impact on firms

Small firms (<£600k fees): floor increase would raise premium.
Mid-sized firms: multiplier change would materially affect required cover.
Larger firms: cap lift removes a ceiling that some already voluntarily exceed.
Audit-registered firms: potentially separate minimum framework.
All firms: run-off extension would affect closing/retiring practitioners.

How firms should approach the review period

Provide feedback via ICAEW consultation when opened.

Discuss with insurer/broker how proposed changes would affect firm.

Consider voluntary cover uplift ahead of mandatory changes.

Document rationale for current placement in fair-value assessment.

Frequently asked

Are the reforms confirmed?

Not yet — consultation stage. Timeline suggests effective mid-2027 to early 2028.

Will my premium go up?

For firms below the current floor, yes. For mid-range firms, depends on how multiplier changes.

What about ACCA?

ACCA typically follows similar principles but has independent regulatory framework. Consult ACCA guidance.

Does this affect audit-registered firms differently?

Yes — audit-registered firms already carry higher cover; reforms may standardise this.

How can I input to the reforms?

Via ICAEW consultation channels or through Law Society-equivalent representative bodies for accountants.

Should I increase cover in advance?

Consider it — voluntary uplift may make the mandatory transition smoother.

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