Businesses unaware of payment options for litigation solicitors
Litigation solicitors are failing to alert companies that they can take an ‘after-the-event’ insurance policy out to pay for litigation, a new survey has revealed.
The survey demonstrated a lack of awareness among businesses of the ways in which they can pay for litigation. It also revealed that although companies are concerned about costs, few had used ‘no win, no fee’ arrangements or sought third-party funding.
The research, which was carried out by litigation solicitors Addleshaw Goddard, found that 76% of the FTSE 350 executives surveyed identified costs as their principle concern during litigation. However, only half of respondents were aware of the availability of either ‘after the event’ (ATE) insurance, which protects against the costs of losing a case, or ‘third party funding’, which uses banks of hedge funds to pay. Only 10% had used conditional fee arrangements, commonly known as ‘no win, no fee’ arrangements.
‘No win, no fee’ and ATE insurance are more commonly associated with personal injury cases, but may also be available for a business involved in a dispute.
The findings follow the announcement of a review of England’s litigation costs prompted by concern that fees are rendering the jurisdiction uncompetitive.
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