Legal Expenses Insurance (LEI) is a type of insurance which covers people and businesses for the potential costs of various kinds of legal action. When something happens to trigger the need for legal action, it is known as ‘the event’.
Broadly, there are two types of legal expenses insurance (LEI) – Before the Event (BTE) and After the Event (ATE) insurance.
Before the Event (BTE) insurance is taken out before the ‘event’ happens, and is usually sold as an add-on to an existing insurance policy such as household insurance. It is also available for car insurance and will cover any uninsured loss related to road traffic accidents. It is sold on personal and commercial terms. BTE insurance is paid on an annual basis, by paying a premium to an insurance company.
ATE insurance is only taken out once the ‘event’ has occurred to insure a person or business against the risk of losing their legal case. A policy is taken out for each claim.
BTE and ATE insurance are available for most areas of law (not criminal law).
