What is ATE (After the Event) Insurance?
In many cases, following a personal injury or other incident, an individual or small business may be reluctant to pursue a claim for compensation because of the costs associated with unsuccessful litigation. In instances where a claimant has pursued a claim but is denied compensation through the court system, they are still liable for any costs associated with that claim; this can include not only their own solicitor costs, court fees and legal disbursements but also the costs of the third party if the litigation being pursued in unsuccessful.
ATE Insurance also known as “After the Event” is an insurance policy, which can be taken out following an accident, personal injury or other incident by a small business or individual. This differs from BTE (Before the Event) insurance such as house insurance, car insurance or life insurance where the policy needs to be in place before an event occurs in order to recover costs. An ATE insurance policy will cover litigation costs and court fees where there is a possibility that the claimant may be unsuccessful.
This new wave of insurance is a real landmark for small businesses in Ireland, allowing them access to justice in a way that was previously hindered by the fear of court and litigation costs. A very real concern for small businesses prior to the introduction of ATE Insurance was bankruptcy or serious financial hardship due to going up against the ‘big guys’ and perhaps having to cover all of their costs in court should litigation fail. With ATE Insurance, small businesses and individuals can alleviate these concerns.
Taking out an ATE Insurance policy prior to litigation means that justice is not limited to only those who can afford it. ATE Insurance means that those on the lowest incomes and owners of small businesses are afforded the same judicial process as larger companies or those with higher incomes.
All approved costs for legal disbursements are recoverable in the event of an unsuccessful claim when an individual or small business has ATE Insurance cover in place.
Costs associated with unsuccessful litigation can include but are not limited to:
- Court Fees
- Counsels Fees
- Medical Reports
- Expert Witnesses
- Specialist Consultants
- Legal costs for the third party (respondent).
For a claimant who has an ATE insurance policy in place, these costs will in most instances be covered, so no out of pocket expenses or undue financial trauma will be experienced because of an unsuccessful claim.
When should you take out ATE Insurance?
If you are pursuing a personal injury claim ATE Insurance can be taken out after your claim for compensation has been released from the Injuries Board (PIAB) process and permission has been granted to pursue your claim through the court system. If you are pursuing commercial claims, financial claims or alternative litigation ATE Insurance Ireland can be taken on once you are engaging with your solicitor and have sufficient supporting documentation to verify your claim. Your solicitor will work with you to put a policy in place with a reputable ATE insurance provider or you can deal with specialist brokers like Claims Funding that will do this for you at no cost or obligation.
Note that any legal costs/disbursements incurred prior to taking out an ATE insurance policy will not be covered, so it is in your best interests to incept a policy asap. Once the policy is incepted the legal disbursements noted on your policy will be covered by the ATE Insurance.
Claimants who take out an ATE insurance policy late in proceedings or when it seems more likely that litigation will be unsuccessful, will find themselves incurring the costs that have accumulated up to the policy start date and may not secure after the event insurance terms.
Can anyone take out ATE Insurance?
Because all cases are different, ATE Insurance Companies will assess each case individually before agreeing to provide terms. Not every claimant will fit within the requirements to qualify for an ATE policy. It is in your best interests to speak with your solicitor or a specialist broker like Claims Funding once you know litigation is being pursued so that you can insure your case asap.
Your premium and policy will be tailored to meet the financial requirements of your case and a risk assessment will be carried out by the insurance provider. An estimate of costs will be provided by your solicitor and in the event of an unsuccessful claim, these costs and the costs of the successful party will be covered by the ATE insurance policy.
Benefits of ATE Insurance:
The benefits of ATE insurance for both the claimant and representing solicitor include:
For the Claimant:
- Peace of mind at all stages of the legal process, knowing all costs are covered regardless of the outcome.
- ATE insurance is available for multiple areas of litigation with the exception of criminal litigation.
- Financial risk is no longer an issue for the policyholder.
- Once the opposing counsel is aware that you have an ATE insurance policy, there is a higher chance that the claim will be settled out of court.
For the Solicitor:
- The solicitor now bears no financial risk for costs associated with the case and is free to represent any individual who would under normal circumstances not be able to bear security of costs.
- As the ATE insurance provider will undertake their own risk assessment prior to offering a policy, it provides the solicitor with a case analysis the solicitor now has an early indication of the likely outcome of the case.
- Solicitors will discuss costs and the potential pitfalls of pursuing litigation prior to engaging on a claim. By making clients aware of ATE Insurance they ensure that their duty of care is completed in detail which provides complete transparency on the litigation process, costs and potential pitfalls in the event of unsuccessful litigation.
How much will an ATE Insurance Policy Cost?
Because each case is assessed on it’s own merit and each policy adapted and tailored to the specific requirements of the individual, premium costs will vary from policy to policy. By engaging Claims Funding to facilitate ATE Insurance we will carry out the review process by working directly with your legal team and can present your case to ATE providers in order to get specific terms for your case. This is a service we provide with no upfront costs or obligation.
Is ATE Insurance Valid in Ireland?
Yes, as demonstrated in Greenclean Waste Management Limited v Maurice Leahy (2015), the Court of Appeal accepted ATE Insurance as security for costs. ATE Insurance is a legally compliant product and does not breach maintenance and champerty or third party funding laws.
“ATE insurers provide a legitimate service by providing access to justice.”
Hogan J in Greenclean Waste Management Ltd v Leahy