What is Legal Expenses Insurance Cover?

Legal Expenses Insurance, commonly known as ‘LEI’ is often attached to your home and contents, vehicle, credit card or travel insurances policies. Some insurers include LEI as standard however most providers will let you have it as an add on. 

LEI can protect you against future legal costs as the policy allows you to obtain legal advice and representation throughout your matter. However, if you have LEI it is important to check the amount of cover you have, some policies only provide a certain amount of cover e.g. costs up to £20,000. 

What does Legal Expenses Insurance cover?

Most standard LEI policies will cover the following:

• Claims in relation to the sale and supply of good and services
• Personal injury and compensation
• Employment issues
• Property issues

What criteria do I need to meet to use Legal Expenses Insurance Cover?

Unfortunately, having LEI doesn’t necessarily mean your insurer will cover your legal fees and representation. In most circumstances, your insurers will need to be satisfied that your case has a ‘reasonable chance of success’. In the legal world this means that on the balance of probabilities your case has at least a 51% chance of succeeding in a Court room. This is something that a solicitor would determine on your behalf. 

In more complex cases or if there is disagreement in the likelihood of success, advice should be sought from a Barrister, who are able to provide a more critical opinion on matters. Unfortunately, if your case has little chance of success your insurer will reject your claim. 

Factors that will be taken into consideration when assessing your chances of success include, but are not limited to, the following:

• Evidence
• The relevant law
• Limitation issues.

Another factor your insurers will take into account is costs in the case. It is important for your insurers to look at whether the value of your claim is proportionate with the costs involved. When making a claim with a value under £10,000 this is classed as a small claim in the small claims court. 

Unfortunately, in the smalls claim Court, even if you are successful, you cannot recover your legal costs from the other party. Your insurer will be looking at what is recoverable. Therefore, if your claim is for £5,000 and your legal costs for example will exceed £3,000 your insurer may reject your claim due to the unproportionate costs. 

Are they any time restraints involved with Legal Expenses Insurance cover?

Unless your policy states otherwise, your insurers will not usually cover you for a claim that predates when the policy was enforced. In addition, if you go to a solicitor with the intention of being cover by LEI and you start the claim, including racking up costs but this has not been approved by your insurer, you may not be covered. 

If you are wanting to start a claim it is important to get permission of your insurers first, to make sure you are covered. In addition, sometimes your insurers have an approved team of solicitors they want you to use, therefore, you do not want to start a claim at a solicitors’, if they are not approved by your policy. Always check the terms of your policy before pursuing any claim as this will have all the important details in to check you are covered. 

If you require further information or advice about Legal Expenses Insurance cover, contact our team today.