Insurance for bookkeepers
Bookkeeping is a vital function for all small business owners. Recording, tracking, and organizing financial transactions throughout the year daily, weekly, or monthly is a necessary recordkeeping and data management practice.
Bookkeepers perform the critical first step in a business’s accounting processes. A bookkeeping role carries several mission-critical responsibilities, from accurately classifying and identifying transactions to managing client billing, paying vendors, a business’s payroll, and preparing internal management reports. With no room for errors, all bookkeepers should have a bookkeeper insurance policy to protect them if something goes wrong.
What is bookkeeper insurance?
Bookkeeper insurance is a policy package designed to protect bookkeeping professionals against the specific risks of providing financial services, such as negligence or errors and omissions.
Mistakes can happen and disrupt your business in a matter of minutes. We know what makes your business unique; leave it to us to find the best fit for you
What does it cover?
A comprehensive bookkeeper insurance policy typically includes the following types of coverages:
- Errors and Omissions (E&O) Insurance: E&O insurance, or professional liability insurance, is a must-have for bookkeepers. It is designed to protect bookkeepers from liabilities incurred if you make a mistake or are accused of negligence by one of your clients. E&O coverage covers economic losses suffered by your clients, as well as the outcome of lawsuits alleging errors, omissions, misconduct, negligence, and failure to deliver a service as promised.
- Commercial General Liability (CGL) Insurance: CGL is designed to protect you and your business from third-party claims alleging bodily injury and property damage, such as an accident on your premises. Often called ‘slip-and-fall’ insurance, CGL also covers advertising-related liability and damage or loss to your clients arising from your business operations or products that occur on your business property.
- Cyber Liability Insurance: Most business is conducted online nowadays, and for bookkeepers, electronically exchanging confidential information is commonplace. It is your responsibility to keep your clients’ financial and confidential information secure from the risk of a cyber-attack or an accidental data breach. Cyber liability protection provides you with coverage for costs associated with cybercrime and data breaches. It includes coverage for legal advice, credit monitoring, and repairs and restoration of your software systems due to a cyber-related event. It also provides coverage for losses you sustain due to a system outage resulting from a cyber-attack.
- Legal Expense Insurance: Hiring and retaining a lawyer is not cheap. Legal expense insurance provides you with financial support for a broad range of reasons, such as if you require legal advice if you’re audited by the Canada Revenue Agency (CRA) or wish to appeal a decision made by the CRA. It also covers statutory license protection, employment or client contract disputes, and property protection and bodily injury if you choose to pursue legal action against a third party for damaging your property or harming you or one of your employees. Most importantly, if you need to retain a lawyer, legal expense insurance is designed to pay for that expense.
Do bookkeepers need insurance?
Professionals who offer bookkeeping services should highly consider insurance to protect themselves from potential lawsuits against their business.
We’ve insured more than 1,000 financial professionals. Some of our clients include:
Your profession is unique, and coverage requirements may vary. Speak with one of our licensed brokers about customizing your policy to suit your specific business insurance needs.
How much does it cost?
The average insurance cost for a bookkeeper starts around $300 per year for an E&O policy with a $500,000 coverage limit. However, the exact cost of your policy will vary depending on several factors, such as:
- Training and experience
- Your office location
- Annual and projected revenue
- Services provided
- Number of employees
Common claims scenarios
Frequently asked questions