Continue reading

Why a proactive approach to risk management is so important

Karen Eckstein covers seven impacts arising from a claim against the firm, all of which have a cost that can be avoided by taking a proactive approach to risk management.

Claims Accountants and tax advisers are facing a tough professional indemnity insurance (PII) market. It is harder this year than ever before to obtain insurance on terms that are commercially acceptable. A poor claims history will not be helpful when trying to negotiate terms with insurers (or to persuade insurers to offer cover in the first place). Firms that take a proactive approach to risk management will fare better in obtaining cover, and achieve more affordable prices. Time spent on ensuring that the firm is presented as the best possible risk is more important now than before.

Firms have already put risk management processes and systems into place. However, mistakes can happen and claims can arise. The change in working practices caused by the COVID-19 crisis, with remote working happening at very short notice, has highlighted any weaknesses in the firm’s monitoring, supervision, processes and systems, as well as those of their staff.