Law Link has been providing ATE insurance solutions for our solicitor partners and their clients for over fifteen years
What is it?
After The Event insurance, commonly known as ATE, is a range of policies designed to allow solicitors’ clients to pursue legal actions without worrying about their liabilities if the case fails. ATE insurance is usually provided to claimants, but can also be relevant to defendants. Policies are generally taken out by solicitors to protect their clients’ interests.
Why is it needed?
ATE insurance provides the client with protection from their liability for legal costs if the case is unsuccessful. Without a policy, in the event of a failed case, a client may be liable for the other side’s legal costs, together with the disbursements of both sides. Disbursements might typically include court fees, experts’ report costs, etc. These can often add up to substantial amounts for the client to pay if they do not enjoy the valuable protection of an ATE policy.
When should a policy be taken out?
We always advise our solicitor partners to take out an appropriate policy at the beginning of a case. This ensures protection against costs from day one and usually means a lower premium, together with a higher chance of obtaining cover. Some practices are inclined to wait until a case gets to issue stage before seeking ATE cover for their client. However, this has a number of drawbacks. Any costs incurred prior to the inception of the policy will not be covered, meaning the client will be personally responsible for these should the case fail. Since the case is further on in the legal process, it inevitably carries a higher risk of failure, meaning insurers may not wish to offer cover at all, or if they do, a much higher premium is applied. There are numerous instances of disgruntled clients pursuing their own solicitor for not advising them to take out cover at the outset of the case. At best, the solicitor is facing an upset client and at worst, a potential legal action for the client’s increased liability.