She gave good advice…and was still taken to court

Angie’s been working as an accountant for over five years. She’s diligent, enjoys her work, and likes the fact that she gets to make people’s lives easier.

One day, a client asked Angie about whether or not they needed to claim for some expenses. It was a straightforward query, the kind Angie handles all the time, so she gave her advice and the conversation moved on.

A few months later, the client came back to Angie, upset. They’d had a review, and the expenses Angie had advised on hadn’t been treated the way the client had expected. Now, they faced a surprise tax bill, plus penalties.

Angie was, in a word, blindsided. She just didn’t understand: she’d given sensible, professional advice, the same way she always had for years.

But, looking back, she remembered that there was something. In the conversation with the client all those months ago, there was a detail about the client’s business setup that just hadn’t come up. So, while her advice had been broadly sound, it hadn’t been specific enough to the client’s situation.

That missing piece was the basis of a professional indemnity claim against Angie.

It’s reassuring to think that if you’re careful and you have the experience, you won’t face a claim. If you stay organised, avoid obvious errors, and make sure to double-check – surely everything will be OK?

For many business owners, this just seems like common sense, but unfortunately professional indemnity (PI) claims don’t always follow that logic.

In fact, many claims don’t come from big, obvious errors at all, but from something much more everyday: the advice you give and the way it’s understood.

While the above case study is fictional, what happened to Angie isn’t unusual – in fact, it happens all the time.

The truth is that when people make PI claims based on negligent advice, it’s often not about glaring mistakes but about gaps: things that maybe weren’t fully explained, risks that weren’t highlighted, or options that weren’t explored.

If your work involves giving advice, you’re already in a space where things can be left open to interpretation.

You can explain something clearly and even feel you’ve covered all the key points. But if a client walks away with a different understanding – or they feel something wasn’t explained properly – that can be a problem.

It’s important to bear in mind that these situations can happen to anyone, even when you’re doing your job well.

Broadly speaking, PI claims fall into three categories: omissions, failure to clearly identify risks, or offering unclear or misconstrued advice.

Lots of people have this idea that it’s only the big situations and ideas that lead to risk, but that’s not the case. Especially in PI, risk tends to arise from everyday interactions – not what you said but what you did.

For example, maybe a risk felt obvious to you, so you didn’t dwell on it or go into too much detail. Or maybe a detail slipped through because it didn’t seem critical at the time. Now, imagine that that tiny oversight is the missing piece that can fuel a client’s claim against you later on.

That’s where professional indemnity insurance comes in. It’s designed for exactly this scenario, covering not just mistakes you make but omissions and unmet expectations in your work.

It might be a bit hard to swallow, but it’s true: even the clearest advice can be misunderstood.

In fact, miscommunication is a big reason behind many PI and errors and omissions claims, particularly where clients assume cover, outcomes or risks that weren’t actually agreed.

No one is necessarily doing anything wrong. There’s simply a mismatch in understanding.

Business is often busy – that’s just how it is. That means it won’t be news to you, as a business owner, that you sometimes need to squeeze things in – a quick phone call before a meeting, a reply between two tasks.

But these small things can carry a lot of weight, especially if a client relies on something said in passing that means that things then don’t turn out as expected.

The UK PI market is huge, with around 1.5 million businesses with this kind of cover ¹. These businesses understand that it’s not about second-guessing every conversation or even about approaching your work differently, even when you know it works for you.

Because, no matter how fastidious you are, misunderstandings – and therefore mistakes – can still happen. That’s just what it means to work with clients. You can think of PI insurance not as a sign that something’s gone wrong, but as a safety net that’s there to catch you in the event things don’t quite go as planned.

Sources:

1. Claims and Consequences: Professional Indemnity in the UK

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