Professional Indemnity Insurance (PII) for CIOT/ATT Members

Artificial Intelligence & PII – The Implications

By no means commonplace at present but some members may have encountered additional questions posed by their Professional Indemnity (PI) Insurers on this subject at renewal, with the Insurer perhaps asking for brief examples of any Artificial Intelligence (AI) use and any internal guidelines that might be in place to cater for that.

We now expect to see a greater focus on this topic from PI Insurers going forward. Whether a CIOT/ATT regulated tax adviser or an ICAEW regulated accountant, members will no doubt be aware of the very informative guidance and information available from each body aimed at ensuring good practice in the use of AI with safe and responsible methodology being the key features.

This guidance might take the form of courses, practice notes and webinars, see www.tax.org.uk/ciot-ai-webinar-series or www.icaew.com/technical/technology/artificial-intelligence by way of example.

What Are The PII Implications?

• Some insurers have expressed concern over the extent of reliance upon AI, whether that be the danger in simply accepting AI feedback or perhaps not understanding its assumptions but still utilising them.
• Insurers will look to take comfort from an underwriting perspective where adherence to good risk management measures in the use of AI can be confirmed.
• It is possible we’ll start to see new questions regarding risk management standards within proposal forms at some point, but ahead of that, we’d suggest all Practices if looking to use AI, give some thought to how they plan to evidence their due diligence.

What To Advise Insurers?

• Thinking about your next PII renewal, we’d suggest that the Practice should detail their plans to their PI Insurers, via ourselves, in good time.
• Plans might include an AI policy in place internally, maintenance of a risk register, implementation of staff training, a named staff member responsible for AI, a regular audit system in place and updated terms & conditions informing clients of the use of AI.
• Details of any further sense checks/human verification on AI information produced to ensure accuracy.
• Highlight where the Practice might follow CIOT or ICAEW guidance.

Should you have any queries relating to the above, please do get in touch with us via your usual contact.