ATE Insurance UK: Why It Matters for Litigation

Overview

ATE insurance is a policy taken out after a legal dispute has already arisen, usually before proceedings are issued but sometimes during a case. Its core purpose is to cover the financial risks that come with losing a civil claim.

Unlike Before the Event cover, which tends to sit inside home or motor policies and responds to disputes that have not yet happened, ATE is bought specifically in response to a known problem. A typical policy will respond to the other side's costs if a costs order is made against you, and it will often also cover your own disbursements such as court fees, expert reports, and counsel's fees.

Premiums can sometimes be deferred and only payable if the case is won, which is one of the reasons ATE is commonly paired with a conditional fee agreement. Policies vary widely in scope, price, and conditions, so the wording of any individual policy matters a great deal.

Key steps

1. Consider cover early in the dispute. The best time to think about ATE is as soon as it becomes clear that formal proceedings may be needed. Arranging cover early gives you options, allows time to shop around between insurers, and avoids the awkward situation of trying to place a policy once costs have already started mounting.
2. Assess the merits of your case honestly. ATE insurers generally only offer cover where the claim has reasonable prospects of success. Be prepared to provide a clear summary of the facts, the legal basis for the claim, the likely value, and an honest view of the weaknesses, because insurers will underwrite based on what they see.
3. Compare policies carefully. Different insurers cover different things. Some include own-side disbursements, some do not. Some cover counsel's fees, some exclude them. Look closely at the cover limit, any exclusions, whether the premium is deferred, and what happens if the case settles partway through.
4. Check the insurer is FCA authorised. Firms arranging or selling insurance in the UK must be authorised and regulated by the Financial Conduct Authority. You can verify this on the FCA register before you commit. This protects you and confirms the policy is a genuine regulated product, not an informal arrangement.
5. Keep your insurer informed throughout the case. ATE policies almost always contain ongoing obligations, including duties to notify the insurer of settlement offers, significant changes in the case, and procedural developments. Failing to comply can void cover at exactly the moment you need it, so read the policy terms and follow them.

Common questions