Legal Expense Insurance

We reiterate our commitment to ensure that, as early as possible, you are covered against any risks by way of insurance.

You may be able to obtain Legal Expense Insurance (LEI) to cover some or all the costs of losing the case (including the risks of being ordered to pay your Opponent’s costs). We will ask you whether you have any LEI by way of a Before the Event Insurance Policy (BTE), usually Attached to Buildings and Contents Insurance, Credit Card Insurance, Motor Vehicle Insurance or if you are a member of a Trade Union which often includes the benefit of LEI. WE STRONGLY ADVICE YOU TO REVIEW ALL POLICIES.

1. What is Legal Expense Insurance?

a. Legal Expense Insurance is a generic term used to describe either Before-the Event Insurance or After-the-Event Insurance.

b. Before-the-Event Insurance relates to a policy of insurance that exists before the event complained of happened and enables the policyholder to pursue a legal claim by providing financial protection.

c. After-the-Event Insurance relates to a policy of insurance taken out after the event complained of happened and enables people to pursue a legal claim by providing financial protection.

2. Do I already have Legal Expense Insurance?

a. First you will need to check whether you have a stand-alone policy or whether Legal Expense Insurance is attached to any of the following:

i. Home content insurance policies.

ii. Building insurance policies.

iii. Motor vehicle insurance policies.

iv. Credit cards.

v. Bank Accounts.

vi. General insurance policies, sometimes have Legal Expense Insurance attached to the policy.

b. Trade Union Membership will have the equivalent of Legal Expense Insurance as part of that membership.

3. What does Before-the-Event Insurance usually cover?

a. First check your policy, but BTE may cover the following areas:

i. Road Traffic Accidents.

ii. Accidents At Work.

iii. Employment Disputes.

iv. Family Disputes.

v. Consumer Claims.

vi. Neighbour Disputes.

b. These are the standard areas covered but your policy may have additional cover, so it is important to check your policy.

4. What is After-the-Event Legal Expense Insurance?

a. After the event insurance will provide cover against the financial burden incurred if a legal action is unsuccessful, including opponent's costs, expert reports, barrister’s fees, and court fees.

b. In the event of a loss, the premium is self-insured and so is not payable by you.

c. The premium is deferred until after the case has been successful.

5. If I have Legal Expense Insurance, can I take out an After-the-Event Insurance Policy?

a. First you will need to check you BTE policy to determine the scope and indemnity level. That is to see if it covers the issue you are complaining of and whether the level of protection is high enough for you to pursue your claim.

b. Second, you should check with your BTE provider as to whether they will top up any potential indemnity shortfall or extend the scope of the policy both of which may involve paying an additional premium.

c. Third, if your BTE policy does not cover the issue and / or the indemnity limit cannot be extended then ATE may provide the solution and also a potential “top-up”.

d. If you have any additional questions, please raise them during the initial telephone call.

6. How much does After-the-Event Legal Expense Insurance Cost?

a. Most ATE policies are comparably priced because the ATE market is very competitive.

b. Amberis premiums are outlined below.

7. When do I need to notify my Legal Expense Insurer?

a. First, check your policy which should contain your reporting obligations.

b. Second, generally many insurers expect to be notified as soon as the issue you are complaining of happened. In any event they usually set specific timeframes for reporting incidents to them.

c. Third, some insurers have very strict time limits which if not complied with may invalidate the insurance policy for that particular incident.

8. When do I need to incept an After-the-Event Legal Expense Insurance Policy?

a. We strongly suggest that an ATE policy is incepted at the outset of the claim.

b. ATE will protect you against the risks right from the outset, if a claim is insured at a later stage, then (as with most insurance policies) costs and disbursements which occurred before the date of inception of the policy will not normally be covered.

c. Insurance premiums are calculated on the basis of risk across a “basket of risks” and therefore the more policies issued the lower the premium on the basis that the “many insure the few”.

d. The general disadvantage of incepting a policy later in the claim is that a high level of costs will have been incurred by this time, and the risks of losing are considerable, so the Insurer’s vetting process is likely to be extremely rigorous and the premium will be very high in comparison to what is normally a fixed standard premium if the policy is incepted at the outset.

There are two issues in play, first convincing an insurer that the claim is likely to succeed if the policy is taken out later and secondly convincing you (who has to pay the premium) quite rightly when you argue that it would have been much cheaper if the policy had been taken out the at the outset!

9. Is After-the-Event Legal Expense Insurance recoverable from the Opponent?

a. In short no, the premiums are payable by you.

b. If you lose your case, the policy is self-insured and therefore you will not be asked to pay the premium.

c. If you win your case, you will have to pay the premium, which we will deduct from your compensation payment.

10. What Insurance provider does Copious Law use?

a. We use Parker Colby Insurance Brokers Limited (Trading Style Amberis) who are authorised and regulated by the Financial Conduct Authority (N0 300069) and their status can be checked by visiting fca.org.uk/register.

b. Registered Address: Rydal Mount,168-170 Chaddock Lane, Worsley, M28 1DF

c. Website: amberis-ate.com

11. What are the Premium Levels Payable?

a. The current premiums for the various types of claims are as follows:

b. These premiums are subject to variations by the insurer but provide an approximate guide.

12. Do I need After-the-Event Legal Expense Insurance for FSCS claims?

a. In the vast majority of cases, there is no requirement to incept an ATE policy, if the entity being pursued (Independent Financial Advisor or SIPP provider) has already be deemed to be in “default” by the FCA.

b. However, if there is a live entity, that is a trading Independent Financial Advisor or a trading SIPP company there is considerable benefit in protecting yourself by incepting an ATE policy. It may be that some or all of your compensation has to be pursed via a litigation process.

c. If your case is being pursued via the Financial Ombudsman Service, then any decision made by the Ombudsman may have to be enforced by the courts and there may be a requirement to incept an ATE policy.