Your regulator sets the floor. Your clients set the risk.
CPABC tells a registered firm the least cover it may carry. It does not tell you what your own files are worth if a return is reassessed or advice goes wrong. Those are two different numbers, and the gap is yours.
Confirm your firm’s limit Start your professional services file What you needProfessional liability for accounting, bookkeeping, tax and advisory work
Available above the CPABC minimum
We come back the next business day
Do accounting firms in British Columbia need professional liability insurance?
Yes, if the firm is registered for public practice. CPABC sets it in its own bylaw regulation, and the number depends on how many members hold a proprietary interest in the firm. For each authorized practising office, the minimum is $1,000,000 per claim where one member holds a proprietary interest, $1,500,000 where two or three do, and $2,000,000 where four or more do.
A sole practitioner whose practice is not covered by a firm policy that meets these minimums must carry at least $1,000,000 per claim. Members with a proprietary interest are personally responsible for making sure the firm keeps enough cover in place. The minimums are subject to the commercial availability of such insurance. The wording is short and it is worth reading yourself: read CPABC Bylaw Regulation 1301 (opens in a new tab).
Six things to check in the policy, and only one of them is the limit.
These decide whether the cover does what you think it does.
Professional liability
The claim that says your advice, your return or your audit cost the client money. This is the cover CPABC is asking about.
Prior acts
Work you did before this policy started. A claim can arrive years after the file closed, so the date your cover starts matters.
Run-off
CPABC requires that acts and omissions be covered for at least six years after a member stops being in public practice. That is a real cost at retirement or sale, and it is easier to plan for than to arrange in a hurry.
Defence costs
Whether they sit inside the limit or on top of it changes what your limit is actually worth on a bad day.
Regulatory response
Some wordings help with the cost of answering a complaint or an investigation, which is not the same thing as a lawsuit. Check whether yours does.
The notification term
Your policy has to require the insurer to tell CPABC in writing if cover is cancelled, not renewed, or drops below the minimum. Check that your wording carries it.
Three things worth checking tonight.
Count your proprietary-interest members again
The minimum moves at two and at four. A firm that added a partner last year may be carrying last year’s floor.
Find the run-off answer before you need it
Six years is the standard CPABC sets. Whether your current wording offers it, and on what terms, is a question for today, not for the week you retire.
Read the prior acts date
If you have changed insurer, the new policy may not pick up everything the old one did.
Firms paid for judgement, not for product.
CPA firms in public practice, sole practitioners, bookkeeping practices, tax preparers, and advisory firms that sit beside them. Small firms and growing ones. If your work can be reassessed, disputed or audited, it belongs here.
We place professional liability alongside the other cover a practice carries, so one conversation covers the file rather than four. If you also hold client money and client data, cyber cover for accounting firms is the other half of that conversation.
What the minimum does not settle.
CPABC’s floor is a licensing requirement. It is not a view on what your own exposure is worth. A firm with one proprietary-interest member and a book full of corporate reorganization work is not carrying the same risk as a firm of the same size doing personal returns, and the regulation does not pretend otherwise. The regulation itself says the minimums are subject to the commercial availability of such insurance.
That is the conversation worth having, and it is the one a broker is for. Firms that sell advice outside accounting will find the same questions on our consultants and professional services page.
What accounting firms ask us.
What limit does CPABC actually require?
It depends on how many members hold a proprietary interest in the firm. One member is $1,000,000 per claim, two or three is $1,500,000, four or more is $2,000,000, for each authorized practising office. A sole practitioner not covered by a firm policy that meets these minimums carries at least $1,000,000 per claim. Those are the figures in CPABC Bylaw Regulation 1301, and it is worth reading the regulation itself.
Is the minimum enough?
It is the least you may carry, not a view on what your files are worth. Limits above the minimum are available, and the difference is worth looking at before you decide.
What happens when I retire or sell?
CPABC requires that prior acts and omissions stay covered for at least six years after a member ceases to be in public practice. That can be arranged by a rider on a continuing policy or by a separate discovery policy, which is what the regulation calls it. It is far easier to sort out before the practice closes.
Does my policy cover work I did before I bought it?
Only if the prior acts date goes back far enough. Prior acts dates are easy to miss when a firm changes insurer, so check the date on your current wording.
Do defence costs come out of my limit?
In some wordings yes, in others they sit on top. It changes what your limit is worth, and your own policy is the only document that answers it. Send it over and we will read it with you.
Can you review the cover we already have?
Yes. Send the policy and the declarations page. We will tell you where it sits against the CPABC minimum and where the real gaps are, whether or not you move the business.
Send us the current policy.
Tell us how many members hold a proprietary interest, what the practice does, and what you carry now. We are licensed to arrange insurance anywhere in British Columbia, and we will come back the next business day.