When two or more practicing firms are merging, the Professional Liability Insurance coverage may also be combined. Each participant of the merger will notify CPA PLI in writing of the merger. With instructions, CPA PLI will cancel existing policies pro-rata and any return premium will be refunded. An authorized representative of the new firm will complete a new application form, clearly indicating the date the new partnership/corporation will be established, the date the former firms will cease operations, and the nature of services that the new firm will be rendering. The policy for the new firm will cover the new practice, any work in progress started by the former firms, and, at no additional premium, the services completed by the former firms prior to the merger. Alternatively, a separate Discovery Policy may be obtained to cover prior acts of the former firms at full costs if an agreement cannot be reached by the former partners. In the event of future indemnity payment made by the insurer on behalf of any former firm, a surcharge may be applied towards the premium for the policy that provides former firm coverage.
Upon written notice from an authorized representative, CPA PLI will cancel the policy for a partnership/corporation effective the date of dissolution. Any return premium will be refunded by CPA PLI in the form of a cheque payable to the former partnership/corporation.
Each resulting new firm must complete a new application form to obtain a new policy. Services rendered under the predecessor firm prior to the dissolution may be covered through a separate Discovery Policy or, for no additional cost, by one of the new resulting firms. In the event of future indemnity payment made by the insurer on behalf of the former firm, a surcharge may be applied towards the premium for the policy that provides former firm coverage.