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How accountancy firms can secure their technology transformation

Explore key actions for accountancy firms to protect their digital transformation, minimise risks, and ensure compliance in an increasingly tech-driven landscape.

10/06/2025 · 4 minute read

Mid-tier accountancy firms are at a crossroads. Clients demand real-time data, artificial intelligence (AI)-driven insights, and automation to stay competitive. Failing to embrace technology risks losing market share to tech-savvy competitors. Yet, rapid adoption introduces serious threats: data breaches, ransomware, regulatory fines, and liability claims from tech-enabled services. Without robust protections, your firm could face financial and reputational ruin. Are your current systems — basic tech or outdated cybersecurity — leaving you exposed?

The Institute of Chartered Accountants in England and Wales (ICAEW)’s research report Evolution of Mid-Tier Accountancy Firms underscores this urgency, noting that only 14% of managing partners prioritise IT skills, despite rising client expectations. As cyber threats and General Data Protection Regulation (GDPR) compliance challenges grow, mid-tier firms must act swiftly to secure their digital transformation.

Why technology risks demand action

Technology is a game-changer, enabling predictive analytics and streamlined operations. But the risks are stark:

  • A single data breach can leak client data, triggering fines and lawsuits.
  • Ransomware can halt operations, costing thousands of pounds in lost revenue.
  • AI-driven advice has the potential to generate multiple errors in a short time period, in turn giving rise to professional liability claims and potential regulatory consequences.

Any such event can significantly undermine the reputation and damage the apparent assurance relied upon by clients when instructing accounting firms. Many firms rely on outdated systems or lack comprehensive cyber protections, amplifying breach and ransomware exposure in particular. The potential cost of inaction — financial losses, client distrust, regulatory penalties — is too high to ignore, as these risks could threaten a firm’s existence and reputation.

Most accountants benefit from the ICAEW minimum terms and conditions professional indemnity policy wording (“ICAEW MTC”) and rules. This states that there should be no express exclusion for “cyber liability” claims, except for costs of forensic investigation of a cyber event. However, we do see some policies fully exclude this, which could breach institute rules. This can also lead to possible cover gaps if the complementing cyber liability policy is not reviewed in conjunction with the professional indemnity (PI) policy so that the policies dovetail.

Without such a review, contractual claims for data breaches relating to client commercial data may not always be covered, and more general arguments over whether a claim is a cyber liability or professional liability can more easily emerge. Further, it is important to make sure the policy language adequately covers software provision as part of an accountant's services, per the ICAEW MTC. At Marsh, we make sure our products dovetail and offer suitable cover in line with the ICAEW MTC, and offer options for improved cover beyond those requirements.

How insurance can protect your firm

Insurance is available to protect accountancy firms from technology-related risks. Marsh’s Financial and Professional Liability (FINPRO) division specialises in arranging tailored insurance solutions that ensure your firm can innovate with confidence:

  • Cyber liability insurance: Covers data breach response, business interruption, and GDPR fines, minimising financial and reputational damage.
  • Professional liability insurance: Protects against claims from errors in tech-driven services, safeguarding your firm’s reputation.
  • Risk consulting: Delivers cybersecurity assessments and compliance guidance to fortify your tech infrastructure.

With Marsh, you gain a partner to navigate cyber threats, regulatory complexities, and liability risks, ensuring your firm thrives in a tech-driven market.

Act now

Every day without robust protections increases your firm’s vulnerability. Cyberattacks on professionals have been on the rise for many years. A cyberattack or liability claim could occur at any moment, derailing your operations and client trust. They should proactively schedule a review of their cybersecurity and insurance protections to safeguard their firm’s future.

We provide comprehensive insurance solutions for 18 of the top 50 accountancy firms in the UK and manage a diverse portfolio of over 4,000 accountancy clients. We provide professional indemnity advisory services to the ICAEW. Our nationwide team consists of over 90 professional indemnity specialists, supported by more than 65 claims professionals dedicated to financial and professional lines claims.

For more information, please contact your local Marsh risk advisor.

Our people

Michael Newton

Client Executive Leader, FINPRO

  • United Kingdom

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