In praise of insurers - well, sort of.

Family lawyers rarely encounter legal expenses insurance.  It's been overlooked because most disputes within a family are expressly excluded by insurers. Doubtless this is on the basis that with over 40% of marriages ending in divorce, the chances of the insurer having to pay out are simply too great.  After all, insurance is about taking a premium for something that most likely isn't going to happen.  I was once told that just 5% of policy holders die during the term of a term assurance policy - perhaps taking out a policy is the best health measure we can all take!

By contrast, the dreaded ambulance chasers, personal injury lawyers, are well acquainted with searching out before the event insurance policies.  They come attached to household insurance policies, credit cards and occasionally other policies.  What they generally cover is all manner of civil disputes.  So if you end up in a boundary dispute with your neighbour (heaven forbid!), then your legal fees, and often your liability for your neighbour's if you were to lose, would be paid for you.

However, for the family there is some limited but potentially important benefit for their clients.  Two types of action can on occasion be funded by legal expenses policies.  In the first place, many policies cover Inheritance Act claims.  These enable a family member of someone who has died to make a claim against their estate in the event that they are left with little or nothing from the estate.  They aren't commonplace but for people who depended financially on a relative, they can be vital.  Because they are litigated in the civil courts instead of family courts, the normal rule on legal costs is that the loser pays.  This can be a major deterrent to someone who is already facing financial hardship after the death of a loved one.  With legal expenses cover, both sides costs are usually protected, up to a specified limit.  In my experience, that limit is generally more than enough to reduce the risk to virtually nothing.

More rarely, there may be cover for property disputes between cohabitants.  Often this is excluded from policies but as they also take place in the civil and not the family courts, occasionally they can be covered.  You have to look closely at just how any policy exclusion has been worded.  Again, if you can use your legal expenses policy, it can be of huge benefit as costs generally get deposited on the loser in these cases too. 

So, a word to the wise - always accept legal expenses cover when you are offered it.  Most people won't need it but then again, it's cheap and for those who do need it, it can be the best few pounds you ever spend.


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