One effect of Lord Justice Jackson’s recommendations will be to remove the recoverability of ATE insurance premiums for all policies issued after implementation of the Legal Aid, Sentencing and Punishment of Offenders (‘LASPO’) Act. Implementation is set for April 2013 and it has been confirmed that the Act will not be retrospective. Consequently, if a policy is issued before April, the insured client will be able to seek recovery of the premium upon success, even if success is after April 2013.
Many solicitors and their clients are hoping to benefit from the current recoverability rules and this has inevitably led to a surge in applications for ATE insurance in recent weeks.
ATE insurers are being inundated with last minute applications sent by those hoping to secure an ATE policy under the recoverable regime. It will inevitably take more time than usual for clients to receive responses to their ATE applications and to secure ATE insurance policies.
We are already warning solicitors that there is a possibility of new applications for ATE insurance not being processed in time for implementation of the LASPO Act, due to the probability of delays caused by this last minute surge of cases. Indeed, one insurer in particular has confirmed to us this week that it will be turning away new applications for litigation insurance from firms with which they do not have existing relationships, as of 1st March 2013. We expect other ATE insurers to make similar announcements, even if they work tirelessly to try and process the backlog.
If you have a large volume of applications to process, where you are worried about the impending deadline, you should contact us to discuss possible arrangements to clear the backlog.