How Much PI Insurance Does an Accountant Need?

The amount of insurance an accountant needs depends on whether or not they're a chartered accountant, with which professional body they hold membership and how much they collect in fees. Let's look at how these factors affect the limit of professional indemnity insurance (PII) an accountant needs.

PII Limits for a Chartered Accountant

Chartered accountants must have a professional indemnity insurance (PII) policy, and this policy must meet certain requirements. For starters, PII for a chartered (or chartered certified) accountant must be considered 'qualifying insurance'. Underwriters issuing qualifying insurance agree to abide by certain minimum terms on accountant PII, to make sure all chartered accounts maintain a certain standard of protection.

Next, chartered accountants have to abide by certain minimum limits of insurance as stipulated by their accountancy body membership (e.g., ICAEW, ACCA). The required amount of professional indemnity dictated by these bodies is linked to fee income (both annual fee income and largest client fee income).

Accountancy Body PII Limits of Insurance

Let's have a look at the minimum PII requirements as stipulated by the Institute of Chartered Accountants in England and Wales (ICAEW) and the Association of Chartered Certified Accountants (ACCA), since these are the two largest accountancy bodies in the UK.

ICAEW limits of insurance

Under the ICAEW Professional Indemnity Insurance Regulations (effective September 2024), the previous £100,000 minimum has been abolished.

For 2026, most chartered accountancy firms are now required to maintain a minimum limit of indemnity of £2 million for any one claim and in the aggregate. However, for smaller practices with a gross fee income of less than £800,000, the minimum limit is calculated as two and a half times the firm's gross fee income, subject to a absolute minimum of £250,000.

Additionally, firms must ensure their policy excess does not exceed the higher of £3,000 or 3% of their gross fee income.

ACCA limits of insurance

As of 2026, the ACCA has simplified its requirements into two primary income bands, having increased the absolute minimum limit from £50,000 to £100,000.

For firms with a total income below £600,000, the required PII limit is the greater of two and a half times the firm's total income or £100,000.

For firms with a total income of £600,000 or more, the minimum limit of indemnity is now fixed at £1.5 million.

Note that the old '25 times the largest fee' multiplier has been removed from the standard calculation to simplify compliance.

What if You're Not Chartered?

Accountants who are not chartered technically don't have any obligation to buy PII. That said, it is widely recommended for all accountants to have professional indemnity insurance. To figure out how much you need, you can still follow the guidance issued by the ICAEW and ACCA or speak with a specialist broker or agent regarding limits of insurance.

PII Limit of Insurance Tables for Accountants

We've calculated the minimum PII limits for accountants of various sizes according to ACCA and the proposed new ICAEW requirements in the table below. As you can see, we varied both the total annual fees and the largest fees earned from one client in the past year (which factor into the ACCA calculations).

While these figures show a range of accountancy business sizes, if your business size is not displayed here then you can use the formulas shown in the previous section to calculate what you would need. Use these figures as a rough-and-ready guide to give you an indication of what is basically required; calculating the amount of insurance an accountant needs can certainly be a complicated answer. A professional insurance specialist can help also you figure it out if you still have questions.

Accountancy Examples: Limits of PII indemnity for each and every claim