Litigation risk transfer solutions can take several forms, but the risk is often most effectively addressed with ATE.
ATE is a type of insurance that protects policyholders against the costs risks associated with losing their case. This protection can take various forms but most commonly protects the policyholder against the legal costs of their opponent which may be awarded against them if their case is lost. This is often referred to as adverse costs.
Although ATE cover is usually provided to claimants, we can help arrange ATE cover for defendants in appropriate cases, of all sizes.
In addition to providing cover for adverse costs, ATE can also be used to cover a policyholder's own disbursements, Counsel's fees and own solicitor's costs. This means that nearly all the policyholders’ legal costs can be covered by ATE in the event that the case is lost.
ATE enables policyholders to pursue their claims with confidence. The uncertainty of the adverse costs risk is removed and, if required, own expenses can be covered as well. With these costs insured, policyholders are in a better position to negotiate a favourable settlement or proceed all the way to trial with confidence.
ATE can also help when the policyholder is facing an application for security for costs. There is case law to suggest that an ATE policy may be enough, in itself, to defeat such an application. It can be advantageous to use a rated insurer for this reason, but we can provide advice on this aspect on a case-by case basis. Where an insurance policy is considered to not provide sufficient security, we can provide advice on alternative methods of satisfying an application for security for costs. One such method is a deed of indemnity. Effectively, this is a guarantee from the insurer that they will respond to any adverse costs order should the claim fail. Again, we can advise you on the options that are available.
We have strong relationships with the key insurers in the ATE market. By focusing on good quality cases we have been given access to preferentially rated ATE policies.
Historically, ATE premiums have usually been deferred until the end of the case and only payable if the case is successful (known as a deferred and contingent premium). Knowing that no premium will ever be payable if the case is lost is understandably very attractive to policyholders. Nowadays, however, insurers are increasingly offering policyholders the option of upfront premiums. Whilst these are payable immediately, regardless of whether or not the case concludes successfully, they have the advantage of being significantly cheaper than deferred and contingent premiums. Should you have the cashflow or the funding in place to pay the premium upfront, this could be an attractive option for you.
Whilst upfront or deferred premiums are the most common types utilised, there are alternative premium structures available to clients. These include part upfront/part deferred, staged, staged and deferred, as well as others. We can guide you through the options and advise you on the most suitable premium solution for your case.
We know the ATE market inside out. Our team have years of experience in the litigation risk transfer business and we utilise our market contacts for the benefit of our clients.
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touch if you would like to find out more
about how we may be able to help you with your case and we can discuss the
different options available to you.
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