If you have a tax preparer business, it is vital that you carry business insurance
in order to protect your business from a variety of accidents, litigations, liabilities,
and other risks. As a tax preparer, you are responsible for preparing the taxes
of your clients, an occupation that requires you to be well organized, accurate,
and conscientious. Owning and operating the tax preparer business means that you
are responsible for safeguarding its assets, which includes obtaining the right
kind of tax preparers insurance.
Types of Tax Preparers Insurance
There is a is a wide range of insurance policies available for the tax preparer
business owner, including those protecting him from accidents, fires, liabilities,
extreme weather conditions, and other unforeseen events. Tax preparers insurance
varies allowing the tax preparer the option of choosing one or several different
policies for optimum coverage for their business, while also offering protection
for financial and business assets.
General Liability
General liability insurance is a comprehensive type of business insurance coverage
that includes benefits for various liabilities in order to protect your tax preparers
business assets and financial stability. General liability insurance for tax preparers
includes coverage for the business itself, such as from a possible accident that
a customer or client has in the tax preparer’s place if business which pays for
possible repairs as well as medical expenses of the person that was injured. General
liability insurance also covers the cost of litigation in the event that you, the
tax preparer, is sued for incorrect tax preparation. In most cases a Tax Preparer
will want General Liability and Property coverage and therefore the Business Owners
Policy is more suiting since it contains property coverage in addition to General
Liability.
Business Owners Policy
A business owners policy, also called a BOP, is another important tax preparers
insurance policy to consider. A business owners policy includes both general liability
and property insurance coverage. In addition, the tax preparer business owner has
the option of also including other types of coverages in the BOP such as business
income and extra expense, electronic data, and equipment breakdown to name just
a few.
Business Auto
Some tax preparers use a vehicle for deliveries, pick-ups, or other business related
tasks, such as mobile tax preparation. If this is you, then business auto insurance
is undoubtedly needed. Business auto insurance covers any vehicle used for the tax
preparer business and will cover the cost of damages or medical expenses as a result
of an accident while using the vehicle.
Workers Compensation
Worker’s compensation insurance, which is required by law, should be obtained by
any tax preparer business that has one or more employees working for them. Worker’s
compensation benefits an employee who was injured on the job or who received an
illness through work-related tasks. For instance, a worker who was moving large
tax file boxes that hurts his back through this task can get medical treatment through
their worker’s compensation policy.
Professional Liability
One of the most important types of tax preparers insurance is professional liability
insurance, also called errors and omissions insurance. When dealing with a client’s
taxes and financial information, it is crucial that you are protected from claims,
lawsuits, or other legal actions if a mistake was made during the tax preparing
process. Professional liability insurance will protect your business assets in the
case of a professional mistake made that resulted in the client suing you for damages.
For instance, if a previous client has found that through preparing the taxes, you
made a mistake and the IRS has contacted the client over the mistake which resulted
in a number of inconveniences and financial hardships for them as a result of the
mistake; you can be protected with professional liability insurance if the client
chooses to sue you for damages.
Tax preparers insurance policies, whether you choose one or all of the types of
insurance available to you, is an important part of being a tax preparer and owning
your business. As you continue in your profession, you will have the peace of mind
of knowing you are properly protected from a variety of unanticipated events.
