The government has just completed a mini-consultation on the recovery of after-the-event (ATE) insurance premiums for expert reports in clinical negligence claims, Litigation Futures has learned.
This is the only exception to the end of recoverability of ATE premiums contained in section 46 of the Legal Aid, Sentencing and Punishment of Offenders Act 2012. In a letter sent to a select group of stakeholders four weeks ago, Robert Wright, head of civil litigation funding and costs at the Ministry of Justice (MoJ), sought views on the current thinking on how it will be implemented. Nobis 
The letter, seen by this website, said the MoJ plans to only allow premiums to be recoverable for expert reports necessary to establish liability and causation but not quantum. Further, recovery should be limited to the premium necessary to cover the reasonable cost of two expert reports. It asks whether the court should be able to allow the recovery of premiums for additional reports if satisfied about the necessity and reasonableness of obtaining them.
There are then questions over wh
ether there should be a limit on the maximum recoverable premium and if there should be any rules around costs of the expert reports themselves, such as a cap.
The MoJ’s current position is that the insurance policy should be explicit about the part of the premium that relates to the expert reports for which recovery is sought, and that recoverability will not extend to other expert fees, such as attendance at trial.
Mr Wright also asks how transparency of premiums be improved to enable the courts to assess their reasonableness.
The plan is that the premium will not be recoverable unless the claimant has given requisite notice (such as 42 days, as is currently the case with defamation cases) to the defendant, and the defendant has not responded with an offer that obviates the need for ATE insurance, on the basis that (i) the defendant is prepared to settle; (ii) the defendant is prepared to pay for an appropriate expert report, or come to an appropriate agreement with the claimant on the provision of expert reports (such as offering joint instructions or funding).
“This should incentivise both claimants and defendants to discuss the merits of the claim and work together to keep costs down, and where possible, avoid the need to purchase ATE insurance cover,” Mr Wright said.
The consultation closed last Friday and the MoJ told Litigation Futures that there is currently no date for when it will set out the final policy details for the regulatory framework.