Legal expenses cover may pay costs for specified disputes, subject to the policy’s limits, exclusions and claim conditions.
Legal expenses cover may help pay for legal advice or the cost of pursuing or defending certain civil claims. It does not cover every legal issue. The Association of British Insurers explains that the exact disputes and costs covered depend on the policy.
This cover is often included with, or added to, car insurance, van insurance or home insurance.
Most policies provide “before the event” cover. This means the cover must be in place before the dispute begins. It is different from “after the event” insurance, which may be arranged once a legal dispute has already started.
When you report a possible claim, the insurer or claims handler will check it against the policy wording.
They may consider:
Legal expenses claims usually need reasonable prospects of success. The Financial Ombudsman Service says this will normally mean a chance of success of at least 51%. A legal professional may assess the case before funding is approved.
The likely costs may also need to be proportionate to the amount or benefit being claimed. Cover remains subject to the policy limit, any excess and other conditions.
Motor legal expenses cover may help you recover uninsured losses after an accident caused by another road user.
Depending on the policy, these losses could include:
The Financial Ombudsman Service provides examples of motor legal expenses claims, but the exact cover varies.
Legal expenses cover does not replace your main motor insurance cover. It is separate protection with its own limits and exclusions.
Home legal expenses policies may cover certain employment disputes, consumer contract claims, personal injury cases or disputes involving property and neighbours.
A landlord insurance policy may offer legal expenses cover for some tenancy disputes, rent recovery cases or legal action to regain possession of a property.
These benefits are not included in every policy. Waiting periods, reporting deadlines and other restrictions may apply.
Check whether legal expenses cover is included as standard or offered as an optional extra. Under the FCA rules for optional insurance products, customers must actively choose paid add-ons.
You should also check:
Before-the-event policies will not usually cover a dispute that had already started, or that could reasonably have been expected, before the policy began.
The FCA requires firms to provide appropriate policy information in a comprehensible form, taking account of important benefits, exclusions, limits and conditions. Read the full documents before you buy or make an insurance claim.
An insurer may appoint a panel solicitor during the early stages of a case.
The Insurance Companies (Legal Expenses Insurance) Regulations 1990 protect a policyholder’s right to choose a lawyer in certain circumstances.
The Financial Ombudsman Service says a policyholder should normally be able to choose their own solicitor once legal proceedings need to start. A choice may also arise earlier where there is a conflict of interest or another exceptional reason.
The insurer may still set reasonable terms for legal fees, reporting and how the case is handled.
A claim may be declined because the dispute is excluded, began before the policy started, was reported too late or does not have enough chance of success.
The insurer should explain its decision and identify the policy term it is relying on. The FCA’s claims-handling rules require insurers to handle claims promptly and fairly and not reject them unreasonably.
You can complain to the insurer if you disagree. The Financial Ombudsman Service may be able to review the complaint after the insurer gives its final response or fails to respond within the required period.
We arrange insurance through a range of insurers. Legal expenses cover may be included with certain policies or offered as an optional extra.
Availability, cost, limits and exclusions depend on the insurer, the policy and your full details. We are an insurance broker and do not underwrite the policies ourselves. We cannot guarantee that cover will be available.
Always check your policy documents to understand what is covered, what is excluded and what you must do if a legal issue arises.
