Stewarts has launched a ground-breaking after the event (ATE) insurance facility with Arthur J. Gallagher Insurance Brokers Limited. ‘Stewarts Litigate‘ is designed to work alongside our alternative funding agreements. The facility provides our commercial disputes clients with rapid access to comprehensive ATE insurance at pre-agreed market leading rates. The facility can provide coverage of up to £4 million in three business days and up to £18 million within ten business days.
Over the past decade, Stewarts has recovered £2.22bn in damages from cases funded through alternative funding agreements. Throughout that period, rapid access to ATE insurance has been a challenge for our commercial disputes clients. This facility meets that challenge.
The risk of adverse costs is a critical strategic factor when evaluating litigation. Stewarts Litigate provides a solution that balances the risk, cost and impact of commercial disputes and will help our clients litigate, arbitrate or negotiate from a position of financial strength and security.
Julian Chamberlayne, Partner, Head of KM & Compliance and Head of the Aviation and International Injury department comments:
“The litigation funding market has grown rapidly over the last decade and in our experience, litigation funding is widely available. However the rapid inception of comprehensive ATE cover has been more challenging. Our solution meets that challenge.”
Alan Pratten, Head of Major Risks/Litigation Practice at Gallagher comments:
“Delighted to be working with Stewarts, clients and Insurers in a collaborative way to deliver the ‘best fit solution’ for our clients.”
This communication has been authorised by Arthur J Gallagher Insurance Brokers Limited for the purpose of s21 of the Financial Services and Markets Act 2000
Find out more about Stewarts Litigate here.
What is ATE insurance?
After the event insurance is not a means of funding a claim but is an insurance product often used alongside alternative funding arrangements or litigation funding. In suitable cases, in exchange for a premium, an ATE insurer will provide cover against adverse costs and/or the client’s own disbursements (usually up to a set limit). ATE insurance can also act as security for costs.
Why is ATE required?
English proceedings operate on inter-parties costs principle, where the losing party is typically ordered to pay a substantial proportion of the winning party’s legal costs. Therefore legal costs considerations and insurance are critical when evaluating litigation risk.
The litigation funding and ATE markets
The litigation funding market has grown rapidly during the past decade. Cost orders and security for costs decisions have made funders understandably more wary of the risks of litigation costs. Virtually all funders now require fulsome ATE cover in place before they will finalise their litigation funding agreement.
One of the key problems our commercial disputes clients have faced in the last decade is securing sufficient ATE cover. Few insurers offer ATE at all and most that do only offer limited coverage or seek large deposit premiums.
Stewarts’ history of ATE and alternative fee arrangements
Stewarts has offered conditional fee agreements, accompanied by after the event insurance, since they were first introduced in 1996. Stewarts was also an early adopter of contingency fee agreements and then damages-based agreements from 2013, when legal regulations extended their use to all civil proceedings in England and Wales.
Alternative fee arrangements between law firms and their clients used to be limited to scenarios where clients did not have the money to litigate or had problems with cashflow. That is no longer the case.
You can find further information here regarding our expertise and experience with Litigation Costs and Funding.
If you require assistance from our team, please contact us.
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