Legal Expenses Insurance

Do I need to buy legal cover with my insurance policy? I have just had a quote for my renewal and I have had £20.00 put on it for me to buy a legal cover policy. I have been told that this is compulsory by my insurance brokers, even though they have got it down as an optional extra. Is this true?

Answer

There is absolutely no reason at all for you to buy one of these policies. It is optional and certainly not a legal requirement.

The idea is that for £20.00 paid up front you get the opportunity to have a red-hot Solicitor on your case in the event of you having an accident. Nice idea, but it is not the reality. That £20.00 goes straight into your insurance broker’s profit, and if and when you have an accident if it is one which causes you an injury your broker will sell your claim on to whichever law firm can offer him or her the most money. In a routine personal injury case where a Solicitor is likely to earn maybe £2,000.00, the Solicitor may well have had to pay between £600.00 and £750.00 for that claim. As they have already lost about a third of their money just getting a case in the chances of them getting their best legal brains on the case are pretty limited.

The usually accepted industry statistics are that a motorcyclist has a 1 in 50 annual chance of having a motorcycle accident in which he or she should bring a claim. That means that if you ride for 50 years you will have spent £1,000.00 which will have gone straight to your broker for having the privilege of having your claim sold on as and when you need it. There is also another pretty significant problem with this type of setup. Under costs rules if you have a policy of Legal Expenses Insurance for all but the most serious of claims you are supposed to use the Solicitor who has been appointed by your insurance company. Think about that just for a second. Do you really want somebody who is in the insurance industry backing up your claim (and having made a nice little profit on it) to try and make a claim against another insurer?

Most people in the know don’t bother with this unnecessary expense. There are some advantages to it. You could find yourself getting helped if you have a very minor claim, but the truth of the matters is that the Solicitor who is dealing with this case will make absolutely no money doing it, and human nature being what it is how likely is that Solicitor to fight your case hard if he knows he is not getting paid by anyone? The short answer to your question is: (1) It is an option and not a requirement, (2) As an optional extra you are probably better off keeping the £20.00 in your bank account.

Andrew Dalton

Posted by Andrew Prendergast. Posted on: June 7, 2009 at 12:00 am

Andrew has been riding motorcycles since he was 10 years old and currently rides a GSX1400 as his daily commuter whether it is sunny or snowing. In addition, he is currently restoring an old Honda CB750 K1. Andrew practices across all areas of motorcycle law, with his practice involving both civil claims and motoring defence work.