Legal Expenses Insurance: Getting the Best Representation & Defence

July 12, 2016

Many of us (whether we know it or not) are likely to have some form of legal expenses insurance, possibly as part of professional indemnity insurance, an employment package or another insurance policy. These policies, also known as before the event insurance, cover the cost of legal representation when we find ourselves facing a legal matter, such as fitness to practise proceedings or criminal charges.

Legal expenses policies rarely guarantee a particular solicitor or firm. Instead, the insurer instructs panel solicitors on behalf of their policyholders. Panel solicitors are those approved by the insurer and who have agreed to charge their legal fees at the insurer’s prescribed rates. This can, and does, raise risks for the policyholder. The insurers may instruct a panel solicitor who has little, if any, knowledge of how to handle a case like yours or there may be a conflict of interest.

Legal expenses policies are meant to help us protect our rights, not curtail them. That is why insured people have the freedom to entrust their criminal defence to a representative of their choosing. When facing criminal (or fitness to practise proceedings), this right is vital for funding expert defence solicitors who will fight your corner.

The difference between a defence succeeding or failing often rests on the quality of legal advice and representation. If you want the best possible representation, you need to instruct the best defence solicitor you can find, who is an expert in the law and issues surrounding the allegations made against you. Here we look at the issues surrounding legal expenses insurance, including the freedom to choose your own lawyer under a policy and how we can help you if you have cover and need expert defence solicitors.

How does legal expenses insurance work?

Legal expenses insurance, or before the event insurance, provides the policyholder cover for the cost of legal representation in certain legal matters, such as defending against criminal charges, allegations of professional misconduct or in disciplinary proceedings. Legal expenses coverage may be an add-on to another insurance product, part of an employment package or included in professional indemnity insurance. The premiums paid, whether by an individual, an employer or professional association, go into a pool that is used to cover the claims made under the legal expenses insurance contract.

When faced with an allegation of criminal or professional misconduct, referable professionals, such as health care professionals, teachers, care workers and foster carers, may be tempted to stick with the lawyer or law firm recommended by their insurers. It’s important to be aware that the insurer isn’t necessarily recommending that solicitor because they think they are the best; it is more likely that they are recommending that solicitor because they are the cheapest.

From the insurers point of view, they have a commercial incentive to save as much money as possible. In criminal or professional regulatory proceedings, this incentive often works against the interests of the policyholder. The insurer will want to use the least expensive solicitor and will have very little interest in reducing the chances of a negative outcome that has no financial consequences for them – even if there is likely to be, at the very least, reputational damage to the policyholder. To protect against this situation, policyholders can rely on the fundamental right of every person to be represented by solicitors of their choice.

While insurers may try to put barriers in the way of policyholders to prevent them exercising their freedom to choose, these can be overcome – by getting legal advice from independent solicitors early on, who will investigate the terms of the policy and start working on protecting your interests before insurers instruct a panel solicitor.

The freedom to choose a lawyer

Legal expenses insurance contracts are governed by the Insurance Companies (Legal Expenses Insurance) Regulations 1990. Amongst other things, these Regulations provide for the arrangements that must be made by insurers to avoid conflicts of interests and, crucially, the need for insurers to expressly recognise the policyholder’s freedom to choose a lawyer to defend, represent or serve their interests.

Although insurers have attempted to narrow the right of policyholders to pick their legal representative, courts have upheld the freedom to choose. For instance, rulings of the Court of Justice of the European Union (CJEU) in 2009 and 2013 confirmed the right of policyholders to choose their own solicitor, which couldn’t be restricted to situations in which the insurer decides whether or not an external lawyer is necessary.

In 2012, the Court of Appeal in England & Wales reaffirmed the right of an insured party to choose their lawyer and warned insurers that, despite being allowed to use pre-determined rates, they are not to limit the freedom to choose so as to render it meaningless. (An approach endorsed by the CJEU.)

This means that although insurers often appoint a solicitor for a policyholder, they cannot insist that the policyholder use that particular solicitor. If there is any potential conflict of interest or once proceedings start, the policyholder has the freedom to make their own choice. Nor can insurers impose terms that deny a policyholder the right to choose their own solicitor to act for them under the terms of a legal expense insurance policy.

Specialist Defence Lawyers Manchester – Criminal Offences and Fitness to Practise

At Tuckers, client care is at the heart of all we do. Our clients, whether paying for their defence privately or with the backing of legal expenses insurance, know they are getting the best possible representation. If you’re facing allegations of criminal or professional misconduct and want to know whether your policy terms provide cover, criminal defence solicitor Stuart Sutton can help. He has acted for numerous clients covered by legal expenses insurance and is known to the majority of insurance providers for his outstanding work and for charging rates they can find palletable. For more information about whether your insurer will the cost of representation or any other criminal and professional regulatory matter, please e-mail suttons@tuckerssolicitors.com, or contact Stuart Sutton on 07715005953 or 07798753720.