united-kingdom liability insurance
How a physical person can become liable for claims made against dissolved company?
<ul>
<li>I'm shutting down my <strong>limited company (Ltd)</strong> in the UK</li>
<li>My accountant advises me to purchase run-off insurance</li>
</ul>

<blockquote>
  <p>With regards to PI Insurance, that is your decision however this is the main thing that could become a personal liability in the future. We just want you to be fully aware of the situation and possible future implications.</p>
</blockquote>

<p>I did some reading:</p>

<ul>
<li><a href="https://www.policybee.co.uk/blog/5116/whats-run-off-cover" rel="nofollow">https://www.policybee.co.uk/blog/5116/whats-run-off-cover</a> </li>
<li><a href="http://www.runoffpi.com/about-run-off-pi-cover-insurance/about-run-off-pi-cover-insurance.html" rel="nofollow">http://www.runoffpi.com/about-run-off-pi-cover-insurance/about-run-off-pi-cover-insurance.html</a></li>
</ul>

<p>Apparently I can be liable for up to 6 years after dissolving the company.</p>

<blockquote>
  <p>That’s because it can take months or even years for mistakes and latent problems to rear their ugly heads. If it turns out your work is at fault, you’ll have to pay to fix the problem regardless of whether you’re still in business or not.</p>
</blockquote>

<hr>

<p>So far it's clear. I just don't understand the following logic:</p>

<ul>
<li>the whole point of <strong>limited company (Ltd)</strong> is to limit liabilities</li>
<li>what is the rationale for me becoming personally liable after the closing down the company?</li>
</ul>

<p><strong>Wiki: <a href="https://en.wikipedia.org/wiki/Limited_liability" rel="nofollow">https://en.wikipedia.org/wiki/Limited_liability</a></strong></p>

<blockquote>
  <p>If a company with limited liability is sued, then the plaintiffs are suing the company, not its owners or investors.</p>
</blockquote>

<hr>

<p>In my understanding it should be like that:</p>

<ul>
<li>company did some work</li>
<li>company is responsible for it</li>
<li>company is no more, company is gone</li>
<li>why would anyone chase previous owners and employees of the company?</li>
</ul>

<p><em>(SIDENOTE - I decided to shut down company to limit costs and apparently it is more expensive to shut down than to keep it open)</em></p>

<p>How much does your company have in assets? When you dissolve the company, and the company has £100,000 in assets that gets distributed to the share holders, then you would most likely be liable up to those £100,000 if problems creep up. </p>

<p>On the other hand, if you extracted £100,000 from the company as a loan, then closed down the company, you would also most likely be liable up to those £100,000. </p>

<p>If there were no assets, no outstanding loans and so on, you should be quite safe. And of course you might know whether you have done something that you could be sued for. </p>
