ATE Insurance Premiums UK: Types & Costs Guide

Overview

After the Event insurance is a policy taken out once a dispute has arisen, usually to protect the claimant against the risk of paying the other side's legal costs and their own disbursements if the case is unsuccessful. The premium is the amount the insurer charges for taking on that risk, and it is set by an underwriter who looks at factors such as the strength of the case, the defendant's ability to pay, the value of the claim, and the stage at which cover is being bought.

What makes ATE premiums distinctive is that they are not always paid upfront in the way most insurance premiums are. Because many people buying ATE cover are doing so precisely because they cannot fund litigation out of pocket, the market has developed a range of payment structures.

Some are paid at the end of the case, some only if the case wins, and some rise in stages as the litigation progresses. Each structure shifts the risk, and therefore the price, in a different direction.

Key steps

1. Work out what risk you actually need to cover. Before looking at premium types, be clear on what you want the policy to do. Most claimants want protection against adverse costs, their own disbursements, or both. The scope of cover drives the price before the payment structure is even considered, so get this settled first. 2. Ask the underwriter what information they need. Underwriters price each case on its own facts. They will usually want to see pleadings or a case summary, details of the opponent, the likely damages, and any evidence on prospects of success. The more complex the case, the more material they tend to ask for before quoting. 3. Compare payment structures, not just headline numbers. A low premium paid upfront can work out cheaper overall than a higher contingent premium, but only if you can fund it now. Look at the total cost in both win and lose scenarios, and think about where the money would actually come from at each stage. 4. Check whether the premium itself is insured. Some policies build in cover for the premium so that nothing is payable if you lose. That peace of mind costs more, but for claimants with no other funding it can be the difference between running the claim and walking away. Read the policy terms closely on this point. 5. Review the policy alongside any funding agreement. ATE cover often sits next to a conditional fee agreement or a damages-based agreement with your solicitor. The two need to work together, particularly on how the premium is paid and whether it comes out of damages. Make sure the numbers still stack up after both are taken into account.