To not understand the difference between No Win No Fee and Legal Cover on Home Insurance

[Larafromthe80s]

I was in involved in a serious accident in a public place 2 weeks ago which is being investigated by HSE/EHO and has resulted in me having surgery.
I've had 2 no win no fee Solicitors offer to take my case on, however I noticed the small print on 1s paper work said that I had confirmed I didnt have Home Legal Cover (they never asked). I have checked and I do have this cover but I dont understand the difference despite consulting Google.
Will I have to pay anything if I lose? Will they take a cut of anything I am awarded? I'm covered for 100k
Thanks

They probably won't take the case if you already have cover from elsewhere

If you used your legal cover the whole settlement would be yours, the insurance company would pay out for it. With no win no fee, the legal fees will have to clawed back out of your settlement. So you would end up getting less money if you do win down this route. Plus often you would end up paying more than you would have if you had just paid their rates, because it's based on a percentage of the settlement and if you win a lot of money in the settlement you could end up paying a fortune in legal fees that you wouldn't have otherwise.

@dementedpixie

They probably won't take the case if you already have cover from elsewhere

I've not yet instructed anybody, or do you mean NWNFee won't take the case?

@cuno that makes sense - so will I need to pay anything at all or would insurer's look after all of that?

[quote Larafromthe80s]@cuno that makes sense - so will I need to pay anything at all or would insurer's look after all of that?[/quote]
Insurer would cover it, you won't pay anything. Obviously they assess things first to check your chances of winning etc, but it sounds like you must have a strong case so wouldn't be concerned about that at all. If you have legal cover on your home insurance it is preferable to use that over NWNF. You would be able to use a more decent solicitor too imo.

OP, the legal expense cover you have on your home insurance may cover the legal costs of bringing your claim for personal injury. Your insurer will usually appoint its own panel solicitor to deal with your case. This type of cover can be good as you often get 100% of your compensation. The downside is that the case will be assigned to a panel solicitor (probably elsewhere in the country), the insurer may pressure you to accept a low offer to minimise its risk, and the level of cover may not be high enough to meet the costs involved if the case goes to trial.

If you don't have cover under your home policy then your best bet is a Conditional Fee Agreement (no win no fee). This means you don't pay if you lose but if you win your solicitor is entitled to a "success fee". As the success fee is not recoverable from the other side, it will be deducted from your damages. This is often around 25%.

Fwiw I've gone down NWNF route before, I had to pay 35% of my settlement to solicitor, and barrister was charged separately and would have had to pay for barrister whether I won or lost. So bear in mind that solicitor would be NWNF but barrister isn't. The aim is to settle things outside court though so usually don't need a barrister, but if you end up going to court and lose then it would be a shit situation to be in.

Nobody can say what is best so the below is generic only:

If you have legal expense insurance (LEI) and your legal fees do not exceed their maximum level of cover (usually in multiples of £25k, £50k or £100k) and you win you generally keep 100% of the compensation. If you go via NWNF you usually pay a success fee up to a maximum of 25% of their legal fees.

So for example (and full legal costs are not always payable by the oppo so there is always a risk you may bear a proportion of legal fees):

Example Outcome:
Your case wins and you are awarded £100k compensation for your injury and losses. Your lawyers have a bill of £50k.

If LEI your lawyers will seek their legal fees of £50k from the other side and you keep all of the compensation. So you get £100k less your policy excess (usually fifty quid or so)

If NWNF your lawyers seek their legal fees of £50k from the other side and then charge you a success fee of £12.5k (25% of £50k) so you walk away with £87.5k

Insurance usually looks better on paper but you need to check the small print and they will only represent you if you have 51% prospects or above. Of course most lawyers will only take the risk of representing you if you have strong merits too.

I would generally explore LEI as the first option and have NWNF as back up… but in my experience most LEI is a bit shit so speak to both and choose who you think will get you the best outcome after deductions.

The 35% referred to above is probably a Damaged Based Agreement (DBA) related to something like an employment matter. NWNF agreements for personal injury matters are Conditional Fee arrangements (CFA) and as I have set out above are that, if successful, your legal fees will be covered by the other side and you will be charged a success fee which cannot exceed 25% of the legal fees.

LEI means there is no success fee payable.

And LEI covers your barrister’s fees if the combined solicitor and barrister fees are within their policy limit whereas a CFA will not (though some barristers are willing to act on a NWNF basis).

I realise there are an awful lot of acronyms here! Sorry.

@Nopetryagain

The 35% referred to above is probably a Damaged Based Agreement (DBA) related to something like an employment matter. NWNF agreements for personal injury matters are Conditional Fee arrangements (CFA) and as I have set out above are that, if successful, your legal fees will be covered by the other side and you will be charged a success fee which cannot exceed 25% of the legal fees.

LEI means there is no success fee payable.

Yes, sorry I didn't clarify! Mine was a DBA for employment tribunal.

@Nopetryagain thank you that's really useful.
Chance of success seems high. Whole incident was caught on CCTV and there were witnesses, although the venue is denying it it happened still which is crazy. They initially denied it was caught on camera so I think they are just sticking to the story to avoid further prosecutions

Both NWNF firms had said upto 25% success fee and then when they sent me paperwork through to read they clarified they would take the full 25%. I have no idea how much compensation I would get. Have no claim for anything in my life but would rather keep as much as I can 🙂

Do check what disbursements you will be charged under LEI and CFA (e.g court fees, barristers fees and medical experts fees) as this is often the decider. Good luck.