Preparing for the unknown
If you are a driver or if you have a house, chances are you'll have taken out an insurance policy at some point. None of us can ever really know what's round the next corner, so being insured helps us to have some peace of mind.
It's the same with legal problems. If something big happens that causes a legal action we're not always prepared for it. Finding the time and money for the legal support we need can be difficult. Some insurance products aim to try and help in this situation.
Before the event insurance
When you take out an insurance policy you might be given the option to include legal expenses insurance. This usually means that if the policy-holder is involved in a particular event that leads to legal action, the insurance policy should cover the legal costs involved. This could be things like fees for lawyers, court fines, or legal costs awarded to the other side.
This type of legal insurance is also known as before-the-event insurance. The events that are covered will be set down in the policy. For a motor insurance policy this might be something like being involved in a car accident. In some cases if you have this insurance and face legal action the insurance company will already have a panel of lawyers and will offer to find one to start working with you.
After the event insurance
Another insurance product is after-the-event legal insurance. This aims to cover some legal costs if you face legal action after a big event, like a car accident where someone gets injured.
The insurance could help you meet the legal costs of the other side if you lost a case after appearing in court, as well as some of your own legal costs. If you win the case the other side will usually have to cover the costs of the insurance premium that you have paid too. If the lawyer you work with is providing you with a 'no win no fee' service they might require you to take out an after-the-event insurance policy. This should mean that the legal costs will still be covered even if the case is lost.