Legal expenses insurance - is there an alternative?

Legal expenses insurance v after the event insurance

We are weighing up the pros and cons of legal expenses insurance against the alternatives. Our issue with legal expenses insurance is that it is too expensive. Sold as an add-on to vehicle insurance you will be asked to pay about £25 per vehicle, which is too much. Looking at alternatives makes sense.

Legal expenses insurance is sold under various names. It is a policy you buy just in case you need it. You will use the policy if you have to make a compensation claim after an accident, the purpose being to cover legal costs if your case does not succeed.

Legal expenses insurance is a policy which picks up your legal bill if your case does not succeed. That is good news, but you must appreciate that to get your legal action underway the legal expenses insurer must be satisfied your case has a reasonable chance of success. Just because you have this insurance does not mean you can bring a case, the insurer has to be satisfied the case looks good.

The benefit of the policy is that once the case is approved you can push ahead, and not worry about having to pay legal costs. As the case runs the legal expenses insurer can review its commitment to the case. If new evidence crops up, or if you receive an offer, the insurer usually has to be consulted to see if it will continue to support the fight.

So legal expenses insurance is valuable. The question is can we offer the same protection without cost, and even add benefits by changing our system?

Your Key has offered free legal expenses insurance by paying your premium. Your Key relies on the commissions it receives from the after accident services we arrange, and that allows the policy to be free.

Our aim is to stop you buying legal expenses insurance each time you insure a vehicle. Our message has been that legal expenses insurance is too expensive, and it is not necessary as the Your Key policy is free.

Our one policy replaces all the policies you used to buy on all the vehicles you insure within your family group. You will remember our policy is for you, your spouse/common law partner, children under 21 years who live at home, plus your pillion or passengers.  The policies you buy are usually limited to the use of one vehicle, but ours covers all accidents, so our one policy is the only one you need.

We have worked hard to explain what you have been sold, and replaced it with a free policy. The average cost of legal cover on a vehicle is £25 (for example Bennetts charge £29.99), but we have been thinking hard as to whether we can be even better.

The benefits of Your Key legal cover are:

• It offers the same cover as the policies you buy.
• The Your Key policy is free.
• The Your Key policy covers any accident.
• The Your Key policy covers family members.
• Cover is renewed automatically each year.

We are asked if we cover injuries which have not been caused by an accident, like industrial diseases, and we have to say no. We are also asked if we can help with legal disputes not caused by an accident, and again have to say no. We do not like to say no, so what can we do to help even more people?

An ideal scheme would do all of these things:

• Avoid paying for legal cover per vehicle.
• Provide independent advice after an accident.
• No cost access to an experienced solicitor.
• Protection from legal fees if you have a good case.
• You receive all of the compensation.

We believe we can provide everything we do now, plus these extras by using a legal expenses policy supported by a different type of insurance, called after the event insurance.

After the event insurance is put in place once your case is weighed up and your solicitor decides you have a reasonable chance of success. So how does this compare with legal expenses insurance:

• You do not pay for this insurance as the premium is paid by your opponent.
• The protection offered is the same as a legal expenses insurance policy.
• We can arrange the protection you need without cost.
• We gain flexibility as we can increase our cover from injuries caused by accidents to any injury, and beyond.

We would line you up with a solicitor who will conduct the case under a conditional fee agreement. These agreements are sometimes called no win no fee basis. We like the idea of the solicitor “buying into” the case, as no payment if you lose is a good incentive to get it right. Some critics say only straightforward cases are run under these agreements, but with the right solicitor this is not the case. With after the event insurance in place you have the same protection as with legal expenses insurance.

So what do you think? Rather than offer you a free like for like policy, why not create the same result through a different system, and offer broader cover and support to Your Key members?

Why join Your Key:

• Save money by not buying legal expenses insurance.
• 24/7 accident support helpline.
• Services you need arranged.
• Independent expert advice.
• Protection from legal fees.
• No deduction from compensation.

Join us and you do not need to buy that over-priced legal expenses insurance you are offered each time you buy vehicle insurance. The Your Key system gives you everything you need without cost, whichever system we use.

Comments

1. Chris Says:
   October 15th, 2010 at 5:53 pm

   Query - Hi, can you tell me what benefit there is in having this free policy over
   calling no win no fee solicitors if and when you need it please?

2. Mark Thompson Says:
   October 15th, 2010 at 6:01 pm

   Hi Chris,
   You can see we have been debating this question.
   Your Key is here to provide more than just a compensatuion service. We are an accident support service which sorts out recovery, hire, and repair, as well as lining up your solicitor.
   We see ourselves bringing about a change in the way people buy insurance. Our campaign is based on you not having to buy legal cover, and on contacting us first for independent help after an accident. Even if a member is at fault we can sometimes offer helpful guidance.
   We think we could do the same job on the compensation front by using after the event insurance and a conditional fee, but our nervousness is that we will confuse our members. It takes a long time to persuade people they do not need to buy legal cover, and just as long to persuade people their vehicle insurer is not their representative. Adding no win no fee and a different type of insurance to this discussion may just be too confusing at the moment.
   Let me know what you think.
   Thanks and good luck
   Mark

Post your comment

Posted in questions to yourkey |