Council approves changes to PII Regulations
Council has approved changes to ICAS’ PII Regulations. These come in to force from 1 September 2024 and will apply to qualifying insurance on or after this date.
ICAS members with practising certificates must hold professional indemnity insurance (PII) which satisfies the terms of ICAS’ PII Regulations. This ensures that clients can be financially protected in the rare instances where something goes wrong in an engagement.
The PII requirements are shared by ICAS, ICAEW and Chartered Accountants Ireland, with the three bodies working together on a review of the current provisions, which have been largely unchanged for the past 10 years.
The changes to the Regulations have now been approved by Council and will take effect on 1 September 2024. The new requirements apply to policies which are arranged or renewed after this date.
The new PII Regulations are available here, with the main changes summarised as follows:
- Firms will need coverage of £2m for any single claim and in the aggregate.
- The maximum permitted aggregate excess cannot exceed the higher of £3,000 or 3% of a firm’s fee income.
- For firms with less than £800k in fee income, the minimum limit will be equal to 2.5 times its gross fee income, with a minimum cover of £250k (an increase from £100k).
- A firm with gross fee income > £50m will not be required to put in place qualifying insurance but will need to have appropriate arrangements to ensure it can meet claims arising from being in practice.
- Firms insuring in a group arrangement can be treated as a single entity for the purposes of the Regulations providing that they meet certain criteria.
- Run-off cover when a practice ceases must be in place for two years, with reasonable steps to be taken then to secure cover for a further four years.
Please contact ICAS’ Regulatory Authorisations Team if you would like more information: regulatoryauthorisations@icas.com
