Professional liability insurance

All CPAs are required to have professional liability insurance. Read below to find out why, who exactly is concernedhow the plan works and how much it costs to meet this requirement.

To fill out your declaration and pay your premium, go to the plan administrator’s (ACPAI Insurance) website. To do so, you will need your CPA member number.

Why

While the CPA status gives you rights, it also imposes certain obligations aimed at protecting the public. One of these obligations is participating in a group professional liability insurance plan. Under the Règlement sur l’assurance de la responsabilité professionnelle des membres de l’Ordre des comptables professionnels agréés du Québec, all CPAs must be enrolled in the Order’s group professional liability insurance plan, regardless of whether they provide their services directly to third parties; are employed by a business, an institution or a government; or are retired or not active professionally.

Who and how

All CPAs are required to take out the Order’s professional liability insurance so that they are all covered by the same insurer, even if they work outside Quebec or Canada. For that purpose, you must submit your declaration to the plan administrator selected by the Order. This declaration makes it possible for all CPAs to determine which category of insureds they belong to and pay the corresponding premium based on the professional activities they perform and the income they earn from the professional services they provide to third parties.  All CPAs must submit the declaration to the plan administrator and pay the premium by March 15 of each year.

How much

The insurance premium is based on the risk associated with the various categories of professional activities. It varies from $30 to $1,750 and is tax deductible. CPAs who are employed by a company, an institution or a government and provide few or no services at all to third parties, which is the case of most of the Order's members, merely have to pay the modest premium of $60. This premium insures them in the event that a professional liability proceeding is instituted and their employer's insurance is insufficient or non-existent, and in case they occasionally provide some professional services to third parties, including those they provide for free. For example, CPAs who prepare tax returns for their friends and family, assist in the bookkeeping of an association or sports club or give financial management advice to acquaintances incur their own professional liability and can be taken to court as a result.

It should be noted that the policy covers $1 million per claim, has no total annual limit, and that in the event that you cease to practice or cease to be a member of the Order, you continue to be covered for any professional liability proceeding for six years afterward.

For further details, consult the policy, the explanations regarding the policy wording changes, and the insurance certificate for 2016-2017 and 2017-2018. You can also read the resolution adopted by the Executive committee (in French only) and the policy on refunds for professional liability insurance premiums.

Categories of insureds and corresponding premiums

Members who provide services related to the CPA profession to third parties

Category  Premium 
Members who provide professional services valued above $9,999 to third parties within a firm or other entity or as self-employed members, either as partners, shareholders or employees who have been given the authority to sign reports or other documents
 $1,750
Members who are employed by a self-employed CPA or a firm that provides professional services to third parties (unless they have signing authority)  $500
Members who provide professional services valued below $10,000 to third parties within a firm or other entity or as self-employed members, either as partners, shareholders or employees  $60

Members in industry, the public or parapublic sector, or education

 Category Premium 
Members who work in a business or an institution, in the public service or education, or operate a business, in Quebec or elsewhere

If you also provide services to third parties, refer to the previous category.
 $60

Unemployed members

Category Premium 
Members who do not practice the CPA profession under any circumstances, whether compensated or not, or who are unemployed  $60

Retired members

This insured category is reserved for members who have retired member status (with or with no income)1,2 or who will request retired member status with a view to obtaining it by next April 1 for purposes of the annual dues payable to the Order on March 15.

Category  Premium
Retired members with no income  $30
Retired members with income2 between $1 and $24,999 who work in a business or an institution, in the public service or education, or who operate a business, in Quebec or elsewhere  $30
Retired members who provide professional services valued below $10,000 to third parties within a firm or other entity or as self-employed members, either as partners, shareholders or employees who have been given the authority to sign reports or other documents  $30
Retired members who provide professional services valued above $9,999 to third parties within a firm or other entity or as self-employed members, either as partners, shareholders or employees who have been given the authority to sign reports or other documents $1,750 

1 A retired member with no income is a member who is at least 55 years of age on March 31 of the current year, who does not earn income from any professional activity, and who has been entered on the roll of the Order for at least 10 years.
2 A retired member with income is a member who is at least 55 years of age on March 31 of the current year, whose income from employment, the practice of the profession or the operation of an enterprise within the meaning of the Civil Code of Québec is less than $25,000 per year, and who has been entered on the roll of the Order for at least 10 years.
Retired life members who are not active professionally

This category of insureds is reserved for members who have retired member status and who have been recognized as life members by the Order. To be life members, CPAs must have been entered on the roll of the Order for 50 years (consecutive or not) and have signed a declaration covering their obligations. CPAs may have been members in another province, but must have been members of the Quebec CPA Order for at least 25 years. Life members who are not retired or who are still active professionally (whether or not they are retired) are not included in this category.

 Category Premium 
Retired life members who are not active professionally  $0

Service of suite clause (Canada)/Action against insurer

In any action to enforce the obligations of the Underwriters they can be designated or named as “Lloyd’s Underwriters” and such designation shall be binding on the Underwriters as if they had each been individually named as defendant. Service of such proceedings may validly be made upon the Attorney In Fact in Canada for Lloyd’s Underwriters, whose address for such service is:

1155, rue Metcalfe
Suite 2220
Montreal (Quebec)  H3B 2V6

LMA5028
August 6, 2010

Questions?

Need more clarification on what is covered by the mandatory professional liability group insurance plan and the categories of insureds, the selected plan administrator and insurers or other aspects of the plan?

Contact the plan administrator, ACPAI Insurance, by phone at 1 800 267.4734 or by email at regimecollectif@acpai.ca.

If you still have questions, contact the Order by phone at 514 789.1233, or toll free at 1 800 363.4688 [2611], or by email at assuranceresponsabilite@cpaquebec.ca.

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