Commercial Legal Expenses Insurance

Uh, let us explain.

In our opinion every business should have commercial legal expenses insurance, these days it really is competitively priced as a stand alone product or, increasingly as an optional bolt on product to other policies . In the case of the SignElite Commercial Combined policy, commercial legal expenses insurance comes as standard - of course.

Just one point, Commercial Legal Expenses Insurance is a defense policy, it doesn’t cover you for taking action against a third party otherwise we would all have one, the legal profession would be richer than what they already are and the insurance companies would be be drained.

So what are we on about, reasonable prospects of what? What we mean is Reasonable Prospects of Success, (you will usually find this written into your insurance policy) this means that for the insurer to take on the claim they must have a good probability of a successful outcome, effectively they will not waste money flogging a dead horse when they know its a non-starter.

Generally they will take the view that unless they can be 51% or more confident in a successful outcome they will decline. The decision will either rest with the in-house legal people or a solicitor/barrister.

So is this the insurer just getting out of paying yet another insurance claim, actually no. A line has to be drawn somewhere and there has to be a reasonable chance of success, would you throw your own money at something with little chance of a successful outcome?

There are possible alternatives where there is no reasonable prospect of success clause attached. Directors & Officers Liability insurance can address simillar issues in certain circumstances as they can contain an element of defense only insurance cover, this can be a very complex issue and combining Commercial Legal Expenses with Directors & Officers Liability with Entity cover and Employment Practices Liability insurance can provide the ultimate protection. As always advice on this product should be sought from your intermediary or SignElite, specific to your requirements.

The above is for information and guidance only and should not be relied on for individual circumstances and professional advice must always be sought specific to your individual circumstances and requirements. Finally any and all comments referred to anywhere on this site is for the United Kingdom (UK) market only.

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