After the Event Insurance
After the Event (ATE) Insurance
After The Event Insurance (ATE Insurance) is simply insurance policy that covers the legal costs, fees and expenses involved in a legal dispute.
ATE can be used in many different types of legal action and by either a claimant or a defendant, although most often ATE Insurance is used by claimants.
ATE Insurance cover is frequently arranged by lawyers on behalf of their lay clients, and they might have an agreement in place with an ATE insurance company, or they may use a specialist ATE insurance broker to source ATE cover.
When did After The Event Insurance arrive?
ATE Insurance arrived on the scene following the introduction of The Access to Justice Act which was brought into force in 1999, and paved the way for a new alternative to the traditional way of funding a legal action know as no win no fee agreements, or CFA’s and DBA's.
This Act allowed client’s to insure themselves against the risk of having to pay the defendant’s costs, and own disbursement should their legal action be unsuccessful or abandoned. This insurance was called ATE, or After The Event Insurance, as it was purchased after the claim had arisen unlike more traditional insurances which you buy before an event occurs.
Will I have to pay an After The Event Insurance policy premium?
Yes, unfortunately you do now. Up until 2013 ATE insurance premiums were recoverable from the losing party as an additional liability they had to pay. But following the introduction of the Legal Aid, Sentencing and Punishment of Offenders Act 2012, (LASPO), most ATE insurance premiums are now no longer recoverable, and must be paid by the winning claimant out of their compensation award.
What is covered by an ATE Insurance policy?
After The Event Insurance policies cover the legal costs and expenses that a claimant would have to pay to a defendant when a legal action is lost or discontinued.
ATE insurance will also cover the disbursements and expenses which their lawyers have incurred in pursuing the legal action, for example expert reports, medical reports, Court fees, Counsel’s fees, and Expert fees.
Are there any costs that an After the Event Insurance policy does not cover?
ATE insurance policies will usually exclude own sides legal advisors fees. They will also exclude pre incurred costs and expenses, costs incurred by unreasonable behavior or actions, and any claimant who acts fraudulently would not be covered for anything under most ATE insurance policies.
When should I buy my After The Event Insurance policy?
ATE Insurance is bought after an incident has occurred, but usually before any legal costs or disbursements have been incurred. Taking out ATE insurance at the start of your legal action gives you the best chance of getting it at a good price, as the longer you leave it, the more expensive it will be.
Leaving it later in the legal dispute may mean the cost of your ATE insurance policy is much higher, or it can mean that you are unable to purchase it all at. For example securing ATE insurance a few months before trail is a very difficult task.
What is the cost of an After the Event insurance policy?
ATE insurance policies can cost from as little as £25 for a simple motor accident, right up to several millions of pounds for large commercial actions . ATE underwriters will base their premiums on risk, and so they look at the chance of having to pay out, along with the maximum amount they would have to pay out in the event of a claim.
Then they would add a margin for their own costs, expenses and profit, thereby producing the final ATE insurance premium. (IPT tax would also be added).