Legal expenses insurance or LEI also known as LPI or legal protection insurance is the type of insurance that covers policy holders from the potential expenditure of legal action that is brought against by the policy holder and another institution or individual. After the event and before the event are the two forms of legal protection insurance.
Most legal insurance systems and plans are considered as the before-the-event, although both are known in some jurisdictions like United Kingdom. The concept in the United States is often called as the pre-paid legal services or PPLS. Some of the specialized forms of legal expenses insurance include various professional liability insurance, like malpractice insurance for the medical practitioners, omissions insurance among consultants, brokers and agents.
Before -the-event insurance is taken by those who wish to avoid themselves from possible litigation cost that they will probably incurred in any future circumstances. The said cost usually includes payments for the solicitors, barristers, court fines and fees as well an expert witnesses and a possible cost that is to be awarded to the other side.
Before-the-event insurance is normally paid on an annual basis and frequently, it is sold under certain packages like home and auto insurance package. It is occasionally being offered as part of benefits to adherents of a trade union or association.
After-the-event (ATE) insurance is used after an event occurred, like an accident which produced an injury, it is use to assure the policyholder for payments of all the possible expenses. After-the-event insurance is used as a remedy by those people who do not have their before-the-event insurance. This insurance policy is very helpful when the policyholder loses the case, because the insurance company is the one who’s responsible in paying the opponent’s legal costs and expenses, also for the policyholder’s own disbursements. This policy is very helpful in a “no win no fee” basis for a personal injury cases, because the costs are covered even the case is lost. Solicitors even require their clients whether they are the defendants or the plaintiffs to take this kind of insurance policy.
The payments of premiums are being deferred until the decision of the case, especially in a “no win no fee” arrangement with this the premium itself is self-insured. Solicitors and claims management companies commonly offered this kind of insurance. ATE insurance costs are frequently recoverable by the winning party from the losing side as part of a monetary damages settlement.
Kinds of cost and benefits that are insured:
* Social Court legal protection
* Employment legal protection
* Punitive damages legal protection
* Legal protection contract
* Tax legal protection
* Administration protection(legal)
* Legal protection for fatalities of criminal offenses
* Data security protection(legal)
* Special security protection(legal)
* Court costs
* Charges of marshal
* Legal payment of opposing lawyer
* Correspondence lawyer legal payment
* Foreign court travel expenses of the appearance of the accused
* Conflicts from vehicle purchase
* Traffic law administration expert payments
* Charges of an conciliation and arbitration
* Payment for witnesses