Tax Preparer Insurance Rates
How Much Does Tax Preparer Insurance Cost?

Tax preparer insurance can cover the cost of lawsuits over mistakes, omissions, inaccurate tax returns, injuries, and disputes you might have with clients and other third parties. Because a single lawsuit could cost thousands of dollars, many tax preparers seek out business insurance. The cost of your annual premiums varies — usually between $350 and $700 — depending on the size of your firm and the amount of business you do. To help you get a better understanding of business insurance costs, let's look at four sample insurance quotes for tax preparers.

Note: Insurance quotes below are only estimates. Actual costs can vary.

HOW MUCH IS
Professional Liability Insurance?

How Much Is Tax Preparer Professional Liability Insurance?

All tax preparers have professional liabilities. If you make a mistake filing a return or carry over an inaccurate number from last year's return, Errors and Omissions Insurance can pay for the cost of a professional liability lawsuit. E&O Insurance (also called Professional Liability Insurance) works much like malpractice insurance works for lawyers and doctors. Your professional mistakes can be covered. As you know, mistakes on a tax return can be costly. If you have to amend a return, the odds increase that your client will be audited, which could lead to more problems, disputes about your services, and even lawsuits. Fortunately, you can protect your business from professional lawsuits by investing in Errors and Omissions Insurance.

Tax preparers buy Professional Liability policies with a range of limits, but the most popular are…

  • $1 million / $1 million (38%)
  • $250,000 / $250,000 (30%)
  • $500,000 / $500,000 (16%)
  • $100,000 / $300,000 (16%)

Tax preparers are fairly representative of the financial services industry when it comes to Professional Liability Insurance. They pay pretty much industry average for coverage.

To see how the cost of Professional Liability Insurance for tax preparers compares with other industries, visit Insureon's 2014 Business Insurance Cost Analysis New browser window icon..

HOW MUCH IS
General Liability Insurance?

What Does General Liability Insurance Cost?

A tax preparer's General Liability Insurance can cover the cost of a third-party lawsuit over injury or property damage. This includes bodily injury, slip-and-fall accidents, reputational disputes, and client property damage. Say a client is dropping off a box of trade confirmations and financial documents. While carrying it up to your office, she slips and smashes her wrist as she drops the box falling down the stairs. The client sues you for $40,000 in medical expenses. Your GL Insurance can pay for the lawsuit, covering your lawyers' fees and any damages you may owe the client.

The typical General Liability Insurance policy for bookkeepers costs $350 to $600, right in line with the average cost for small financial services firms in general.

Average Premium Rates on $1M / $2M General Liability Insurance Policies for Tax Preparers Compared with Financial Services Firms in General
Name Industry Average
Average Cost for Small Financial Services Businesses (USD)
Accountant Average
Average Cost for Small Tax Preparation Businesses (USD)

Mean policy premium:

$454.17

$434.54

Median policy premium:

$425.00

$425.00

HOW MUCH IS
a BOP?

What Does a Business Owner's Policy Cost?

A Business Owner's Policy can help you save money on two tax preparer's insurance policies: General Liability and Property Insurance. How does it work? Insurance companies bundle these two policies in a Business Owner's Policy (or BOP), which offers lower premiums to small-business owners. A BOP not only covers your GL lawsuit risks, it also insures your business property, reimbursing you for losses to your equipment, supplies, and other items. BOP Property typically covers fire damage, some weather events, and theft.

Bookkeepers Business Owner's Policies typically cost $450 to $1,000 in annual premiums, in line with industry averages.

Average Premium Rates on Business Owner's Policies with a $1M / $2M General Liability Limit for Tax Preparers Compared with Financial Services Firms in General
Name Industry Average
Average Cost for Small Financial Services Businesses (USD)
Accountant Average
Average Cost for Small Tax Preparation Businesses (USD)

Mean policy premium:

$596.57

$598.06

Median policy premium:

$500.00

$500.00

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Free Quotes on Tax Preparer Insurance

For free quotes on tax preparer insurance, submit an online insurance application with insureon. Work with our expert insurance agents today to find affordable coverage.

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