For 20 years, we have been at the forefront of this highly specialized sector in European markets and through TheJudge Americas LLC, we bring our expertise and litigation insurance solutions (backed by major international insurers) to the US legal market.
While a new concept to many US businesses, Litigation Insurance has been actively used in thousands of commercial cases in Europe over the past two decades. It is the ideal tool for clients who wish to self-finance their attorney fees and/or out of pocket costs and has the potential to fundamentally alter how US corporate enterprises manage their litigation and arbitration budgets going forward.
Attorney Fee Insurance is a policy taken out by a plaintiff to provide an indemnity for the fees and/or out of pocket costs they incur when pursuing a commercial dispute (litigation or arbitration). If the case is unsuccessful, the insurer reimburses the plaintiff for the insured legal fees and expenses up to the agreed budget. This can help in-house counsel to manage their legal budget and avoid any unexpected surprises.
The premium for Attorney Fee Insurance typically costs less than one third of the return charged by litigation funders, which is a key differential that attorneys need to be aware of when advising their clients on potential litigation finance options.
While Attorney Fee Insurance can be used in isolation, it can also work alongside a litigation finance arrangement. For example, an insurer might cover the attorney fees in parallel to a litigation finance company funding the out of pocket costs.
Unlike third party finance companies who will often only consider claims in the tens of millions or above, insurers are keen to have a wider book spread, which means they will consider cases where the legal fees budget are as low as $200,000 through to multi-million dollar budgets.
While applications for insurance are generally made at the outset of the case, it is possible to secure cover at a more advanced stage in the proceedings, and with the potential to retrospectively insure fees and expenses already incurred. This is significant, as even corporate claimants can experience ‘litigation fatigue’ or ‘fee fatigue’, particularly in cases which may have run on longer than originally envisaged or gone over budget.
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