Insurance - PI cover proves hard to get
Insurance companies are taking an inconsistent approach to providing accountants with professional indemnity insurance cover for the millennium bug, the English ICA warned this week.
Peter Burton, deputy director of the English ICA’s professional standards office, said some insurers were providing Y2K cover which will run until the end of 2001, but others were refusing to provide any cover at all.
‘Insurance companies have a bit of a schizophrenic attitude to the year 2000,’ he said. Burton added that, although many bug problems may not be detected until near the end of 2001, insurers could refuse to provide PI for this crucial period.
The warning will heighten concern among accountants who find even modest Y2K PI insurance hard to come by.
A partner at a Gloucester-based chartered accountant, who asked to remain anonymous, was dissatisfied with his firm’s PI, which is capped at #100,000.
‘Our PI cover is very restrictive and we’re looking elsewhere,’ the partner said. The firm’s broker had told him that 95% of accountants get no year-2000 cover at all.
A spokesman for the Association of British Insurers said insurers were negotiating Y2K PI individually with accountancy firms via questionnaire.