Our recent poll on BV professional standards and credentialing organizations has so far received more responses than any prior, single-subject survey—and not just one or two more, but roughly 60% more than our last “record-setting” survey on marketability discounts (in 2009).
However, our survey last week on E&O insurance has received a mere fraction (roughly 1/20) of the responses—so far. And the current results are split: 50% of respondents indicate that they carry errors and omissions (E&O) insurance for themselves, but 50% do not. Nearly one-third of respondents (62.5%) are non-CPAs who practice business valuation, 25% are CPAs, and 12.5% are some “other” professional.
Interestingly, half of the respondents (50%) report having had trouble finding adequate insurance. Just over a third (37.5%) haven’t noticed any change in coverage offerings, but 12.5% say that renewal premiums have increased “dramatically.” As a result, several respondents have added damages limitations or binding arbitration clauses to their engagement letters, but one commented: “I attempted to purchase E&O coverage about a year ago. I found limited market availability. Some told me that they only provide coverage to CPAs. The premia I was quoted were significant percentages of my anticipated revenues.” Now that’s critical.
The E&O survey is still open, and we’re inviting your response here.
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