With After the Event (ATE) insurance, there is no upfront fee to pay when taking out a policy. Instead, it’s paid for after the claim (and only if the claim is successful) as it works as an extra layer of protection on top of a no win no fee agreement.
However, there is the question in the wider insurance industry as to whether this is the right approach, and some brokers are challenging that the process of ATE insurance premiums should be changed to upfront payments instead.
Let’s look at why this is.
ATE Policies
Historically, claimants could recover all the costs from a defendant if their claim was successful, however, with the Government changing this legislation with the LASPO Act 2012, this has since removed the right to recover all associated costs for ATE insurance.
For solicitors, this means that it’s now more important than ever to carefully consider whether providing ATE insurance cover without an upfront payment is worth their efforts, as the claimant won’t have to pay anything if their claim is lost.
It also means that solicitors can now make the decision themselves, determining if there is not any benefit to a claimant by providing ATE insurance cover. For example, they may instead choose to close a claim if a defendant has a robust defence at the beginning of the process, therefore ending the chance of a claimant facing various solicitor or defendant costs as their claim could likely fail at a later stage.
It’s also important to recognise that ATE insurance costs can sometimes change throughout the case timeline depending on time needed to work on the case, and risk level. And whilst typically, ATE insurance is taken out immediately after the event has taken place, it is possible for policies to be arranged at any later stage of the case.
This can sometimes prove more difficult and expensive to secure as the process moves forward, though in cases such as this, having suitable ATE insurance cover in place can guarantee that the claimant will not be left out of pocket to any party if their claim fails – albeit at the detriment of the solicitor if they have incurred costs for checks, surveys, court fees or additional time.
In this sense, paying the ATE premium after the case outcome is the perfect outcome for the claimant as it leaves them financially secured no matter the outcome of the case.
For the solicitor, broker and insurer, however, this means that there is a heightened risk as to whether their time and effort will be paid for in the end.
However, as the cost of any ATE premium is only paid if a claim is successful, providing cover is an issue a solicitor will consider carefully when evaluating the case at the outset.
Other Insurance Policies
ATE insurance – done the right way
As a truly independent FCA regulated insurance broker, amberis works with industry leading insurers to create bespoke ATE solutions which are best suited to meet the protection needs of solicitors and their clients.
Our areas of expertise include personal injury, civil litigation, financial mis-selling, group litigation and energy misrepresentation, and our 20 years’ experience has allowed us to build prosperous relationships with a range of commercially aware, highly trusted insurers.
With amberis, you can rest assured you’re working with the best. Our underwriters are credible, UK domiciled and regulated by FSCS, with a high claims payment ratio and willing to communicate and engage with our customers directly.
As a result, we’re able to offer a unique and flexible approach to ATE insurance, and we can work seamlessly alongside your team as a strategic partner.
