When is Legal Expenses Insurance Needed
Legal expenses insurance is used around the world to protect against the potential costs associated with a variety of legal actions. legal expenses insurance (Rechtsschutzversicherung) is often summarised as LEI, and is also called legal protection or IT law (Anwalt IT Recht) insurance. Legal expenses insurance can be taken out by institutions or individuals, and is often linked with home insurance and other insurance contracts. Because of the very nature of private businesses and their relationship and levels of access to members of the public, this type of insurance is often deemed a necessity to provide protection from the potential of costly legal expenses. There are two primary types of legal expenses insurance on the market, ‘before the event insurance’ and ‘after the event insurance’. When something happens that triggers legal action it becomes known as ‘the event’, and these two types of legal protection coverage are designed to deal with this event in different ways.
Before the event insurance is also known as BTE insurance, and is taken out by people who wish to protect themselves against the possibility of litigation costs that may occur from the result of a future event. There are a huge range of different costs that can be incurred and therefore protected against, including solicitors fees, barristers fees, expert witness fees, and a variety of court costs and associated legal fees. This type of insurance is often linked to personal liability contracts, and can also be sold as part of standard household or car insurance products. After the event insurance is known as ATE insurance, and is taken out after an event. This kind of insurance is designed to protect the policyholder if they lose their case, and is normally used by people who do not have BTE coverage.
In terms of the people and businesses who require legal expenses insurance, there is a wide range of possible scenarios. For example, businesses who are involved with high risk activities may require extensive legal protection coverage, while individual households may simply have access to basic personal liability protection that is included in their household insurance contract. However, there is a particular need for legal expenses insurance within any business or institution that is open to the public, in order to protect from any legal costs that may result from people who have accidents or suffer from injury on private property.