Regulator eyes greater role for legal expenses insurance

LEI: No panacea but it may have a role

The Legal Services Board (LSB) is set to explore whether and how legal expenses insurance (LEI) can help to reduce unmet legal need, it confirmed this week.

Publishing its 10-year strategy for the sector, the oversight regulator said one ambition for 2031 was that “most households have a legal expenses insurance policy or other mechanisms enabling them to access a wide range of legal services free at the point of need”.

Noting that “LEI is rarely used to pay for legal services, even though millions of households have policies”, the immediate work in its business plan for the coming year is to publish research with its public panel, convene discussions and add “our voice to the debate”.

In response to its consultation on the strategy and business plan, both the Association of Consumer Support Organisations and LEI provider ARAG said they welcomed the initiative.

The LSB reported: “ARAG thought that to help improve access to justice LEI needs to be distributed though more channels than the present add-ons to primary insurance.

“The Bar Council agreed that LEI is worth considering as a means to addressing unmet legal need but cautioned that it is ‘no panacea’ and questioned whether our work might duplicate that of the Civil Justice Council.”

The Law Society and Legal Services Consumer Panel were, however, unconvinced that LEI would help consumers access justice and highlighted concerns about the scope and effectiveness of the product.

The LSB responded: “We agree with observations that LEI is not a panacea and there may be issues of value for money to address.

“There are particular challenges in making this insurance available to those who are in the lower socio-economic demographic, and who may not have access to the usual insurance products through which they could acquire it.

“However, while unlikely to be a solution for the poorest in society, LEI could open up access to a large number of other people who cannot afford to pay for legal advice and representation…

“We will avoid duplicating work by others, including the Civil Justice Council’s helpful work on this issue.”

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