PI run-off cover: what to expect
Pick how long ago you ceased (or will cease) trading and your profession. The explainer shows which years typically matter and why — no premiums, no quotes, just the mechanics.
This is an illustration of how run-off cover works in general — not advice, a quote, or a statement of any regulator’s current terms. Regulatory minimums change and wordings differ. Talk to a broker about your own run-off before you cease trading.
Run-off cover, explained properly
Run-off cover is a professional indemnity policy that continues after you stop trading, covering claims made during the run-off term about work you did before you ceased. It exists because PI is claims-made: the trigger is the arrival of the claim, not the doing of the work. A claim about 2024 work that arrives in 2028 needs a policy live in 2028. No new work is covered — run-off is purely the tail of the old book — which is also why the premium behaves the way it does: highest in the first year, when the insured tail is freshest and fullest, then typically reducing year by year as the exposure ages and limitation periods progressively close off older work.
Who needs it — and when the question comes up
| Situation | Why run-off matters | Typical shape |
|---|---|---|
| Retirement | Personal assets are exposed if a claim arrives uninsured after closure | Multi-year run-off from the last day of trading; six years is the common benchmark |
| Selling the practice | The deal decides it: either the buyer’s policy picks up your past work (successor practice) or you buy run-off | Negotiated in the sale agreement — get broker input before signing, not after |
| Closing a company | Claims can still be brought against directors or a restored company after dissolution | Run-off held through the limitation window; take advice on the entity position |
| Regulated professions | Regulators and professional bodies impose minimum run-off requirements | SRA minimum terms for solicitors; ICAEW minimum for accountants; check your body’s current rules |
| Contractual obligations | Appointments and collateral warranties often require PI maintained for stated periods | Matches the contract — commonly six or twelve years depending on execution as a deed |
General patterns, not terms of any policy or regulator. Page reviewed 21 August 2026.
Why claims surface years after the work
Professional negligence rarely announces itself on completion day. Tax positions unravel on later enquiry; structural defects emerge when the building moves; drafting errors in a contract only matter when the relationship sours. The Limitation Act gives claimants six years for most contract and negligence claims — twelve where the engagement was executed as a deed — and latent damage rules can extend negligence claims from the date the problem was discovered. That legal machinery is why the run-off question is measured in years, not months, and why cancelling PI on your last day of trading converts a professional risk into a personal one. Our guides cover the specifics for accountants’ run-off, the ICAEW minimum run-off requirement, and commercial run-off cover more broadly.
Frequently asked questions
What is PI run-off cover?
It is professional indemnity insurance that continues after you cease trading, covering claims made during the run-off period in respect of work done before cessation. It covers no new work — it exists purely because PI is claims-made and claims arrive late.
How long should run-off cover last?
Six years is the common benchmark, mirroring the standard limitation period for contract claims — but deeds, latent damage and regulatory or contractual minimums can all point longer. The right answer depends on your profession, your contracts and your regulator, which is a broker conversation, not a rule of thumb.
What happens to run-off premiums over the term?
The first year is typically the most expensive, because the insurer takes on the full tail of your past work at once. Premiums then usually reduce over the run-off term as the exposure ages. The actual figures depend entirely on your book of work and the market — there is no standard rate.
Do regulators require run-off cover?
Some do. The SRA’s minimum terms require run-off for closing law firms without a successor practice, and ICAEW imposes a minimum run-off requirement on member firms. Requirements change, so check the current rules with your professional body or broker rather than relying on any web page.
If I sell my practice, do I still need run-off?
It depends on the deal. If the buyer’s PI policy covers your past work as a successor practice, run-off may not be needed; if not, you retain the tail and need run-off. Getting this wrong is one of the more expensive drafting mistakes in a practice sale, so involve your broker before terms are agreed.
Apex Insurance Brokers Limited is authorised and regulated by the Financial Conduct Authority (FRN 724952). This page is general information, not advice on a specific policy.