Personal Injury Funding Information Sheet
The below information provides further detail with regards to funding options relevant to Personal Injury cases.
Am I going to end up out of pocket?
No. We appreciate that you do not want to have sleepless nights worrying about legal bills. It is therefore vital that we establish and put in place the most appropriate way for you to fund your claim. We will help you to choose the most appropriate way to fund your claim, to keep your bill to a minimum and to reduce or eliminate the risks of you having to pay anything if you lose.
Paying for your Claim if you win
Since 1 April 2013 the way in which Personal Injury Claims are funded by injured people (known as Claimants) has been altered by the government. If you win the claim then the other side has to pay your basic costs of the claim. There may be costs on top for you to pay out of your compensation, but it is guaranteed that these costs will never be more than 25% of the damages you receive for injuries and past losses. In practice this means that you will always keep at least 75% of your damages after paying your bill, if you are successful in your claim. Some funding options (such as Before the Event Insurance) may mean that all of the costs are paid by the other side with no additional payment from your damages, but are subject to you having the insurance in place before you were injured and subject to their conditions.
Paying for your Claim if you lose
Unless you have brought a fraudulent claim or acted in an improper way, then you should not have to pay the other side’s costs if you lose the claim. You may have to pay your own side’s costs if you lose, but by using an option like a No Win No Fee agreement, you can avoid that risk. You may also take out new insurance to protect you from that risk or rely on existing Before the Event Insurance to protect you. We will help you decide upon a funding option that minimises or eliminates the risks of you being out of pocket if the case is lost.
Paying for your claim if you win, but don’t get awarded compensation as high as the other side have already offered
The other side can put you at risk of having to pay some of their costs even if you win the claim. If they make an offer to you of compensation during the claim, which you reject and carry on to Court, and then the Court awards you less than the offer the other side has already made, you may have to pay some of the other side’s costs, which could be all of your compensation. We will help you choose a funding option which helps you to minimise or eliminate this risk. We will also advise you on offers made by the other side and whether they should be accepted, as and when they are made.
An overview of the funding options we will consider
|Funding:||How it works:|
|Community Legal Service (formerly known as Legal Aid)||Following the Access to Justice Act this is largely unavailable in PI actions.|
|Private Funding||You can choose to pay for your claim as you go along, however, this is risky because if you lose you will not recover your costs and disbursements and you may also have to pay some of those of your opponent.|
|Conditional Fee Agreement (CFA or No Win No Fee)|
This is a good option for people who would otherwise have to pay privately. In simple terms, if you keep to your responsibilities, we will guarantee that you will keep at least 75% of the compensation money awarded to you and that you will not have to pay any fees up front.
We can also confirm that in the event of your claim not succeeding (or not recovering as much as the other side have offered), as long as you follow our legal a dvice, that you will not have to pay any of our fees. However, our disbursements and possibly some of your opponent's costs will need to be paid for. So that you don't have to pay these, we will arrange for an After the Event Insurance Policy that will cover those costs.
|Before the Event Insurance (Legal Expense Insurance)||You may already have an insurance policy in place that will pay for your and your opponents' legal costs and disbursements, even if you do not realise it. Such cover is commonly provided with household contents, road traffic insurance, or in addition to a bank account or credit card facility. These schemes sometimes come with restrictions on both amount of cover, timescales for reporting claim and choice of lawyer.|
|Third Party Funding||If you are a member of a trade union organisation or similar membership group, they may pay for your claim.|
|Damages Based Agreements||Some firms offer these to clients, where the fees that are paid by the injured person are set at a maximum of 25% of the damages recovered, with some offset allowed for costs recovered from the other side. Presently we do not offer DBAs.|
How do I decide which is best for me?
We will discuss this with you and will be in a position to advise you on the most appropriate form of funding once we have reviewed your insurance policies.
We know that funding arrangements can appear daunting, so please don't be afraid to contact us to discuss your position in more detail. Simply get in touch via email@example.com. Alternatively, speak to a member of our team directly on 0330 123 1229.