05 May 11 Board warns: PI insurance deadline approaches
In a media release issued on 4 May 2011, the Chair of the Tax Practitioners Board (TPB), Dale Boucher, reminded all registered tax and BAS agents that they need to notify the TPB of their professional indemnity insurance (PII) coverage arrangements by the 1 July 2011 commencement date for this requirement.
"The Board is working to ensure professional standards and to establish appropriate consumer protection measures. Having national requirements for PII that are set by the TPB will improve compensation arrangements within the tax practitioner profession," Mr Boucher said.
Mr Boucher said that it is an agent’s responsibility to determine what is adequate PII cover for them. They should assess their specific business and risk requirements, speak with their broker, insurer or their professional associations and arrange PII cover that is appropriate for their individual circumstances.
A 12 month implementation period is in place until 1 July 2012. Where a tax or BAS agent already has PII cover that may not meet the TPB’s requirements, the policy can continue during this implementation period. However when the policy lapses, or by 1 July 2012, whichever occurs first, agents will need to obtain cover that meets the TPB’s PII requirements, assuming that it does not do so already.
In some instances agents will not need to meet the TPB’s PII requirements. Agents, such as employees, who are covered by another entity’s PII policy are a good example.