DBA and CFA Insurance (collectively known as WIP insurance) are products designed to provide a law firm with a guaranteed fee realisation when offering an alternative fee arrangement. Whether a CFA or DBA, the insurer indemnifies the law firm for a percentage of the fee exposure incurred under an agreed budget. If the case is lost, the insurer doesn’t receive a premium and reimburses the law firm for the agreed level of fees.
The premium payable to insurers is contingent upon the law firm successfully recovering their contingent uplift in the case.
A significant volume of litigation funders insure themselves on this basis in order to manage the volatility of their portfolios. Now such options are directly available to law firms.
Not only can such solutions increase the options available to law firms when pitching for new business, they can fundamentally help drive growth by enabling the law firm to benefit from the potential significant upside rewards from contingency or success fees but crucially without taking undue levels of risk.
Director of Business Development
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