Insurers celebrate ruling on BTE non-panel rates

Mortimer: surprisingly commercial decision

Legal expenses insurers have welcomed this week’s Court of Appeal ruling about the rates they have to pay non-panel firms.

On Wednesday the Court of Appeal said before-the-event (BTE) providers have to pay an “appropriate” rate to ensure policyholders have a meaningful freedom of choice of solicitor.

The case involved ULR Additions, but it has emerged that three other leading BTE providers – ARAG, Arc Legal Assistance and DAS – intervened in the case.

Robert Kay, chief executive of ULR Additions, said: “We are, naturally, delighted with the outcome, which has totally justified our decision to appeal the first-instance judgment of Burton J.

“It must be right than an insured has the freedom of choice in appointing his or her own lawyer, but equally that the insurers are entitled to rely on the terms of their contract of insurance to provide the best access to justice by utilising pre-determined economic rates. Otherwise, how can insurers accurately price their premiums?

“We were always convinced that common sense would prevail, and thanks to our excellent legal team we believe we have secured an important legal precedent on behalf of not just ourselves but the whole insurance industry.” ULR was represented by Nick Bacon QC of 4 New Square and Dr Mark Friston of Kings Chambers, instructed by Horwich Cohen Coghlan.

Kathryn Mortimer, head of legal at DAS, told Legal Futures that the court had reached a “surprisingly commercial” decision. She explained: “These judges actually understand insurance. When you are trying to underwrite and reserve for the losses you are indemnifying, you have to have some sort of control over what you spend.”

Tony Buss, managing director of ARAG, also welcomed the ruling, saying that insurers dealt with non-panel firm requests by negotiation, recognising that different circumstances demand different types of lawyer. He said ARAG has a panel of firms at different grades depending on the demands of the case.




30 March 2021

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