Master Leonard - Senior Courts Cost Office - 29 May 2015.
Date: 29 May 2015
This concerned an ATE Insurance policy for a Clinical Negligence claim obtained by the Claimant from Temple Legal Protection following the Jackson reforms in April 2013.
The policy insured the cost of experts’ reports on causation and liability and so was recoverable from the defendant. (Section 2 of the Recoverability of Costs Insurance Premiums in Clinical Negligence Proceedings Regulations 2013 No. 92 of 2013)
The premium specifically allocated to cover the cost of these reports was £5,680 plus Insurance Premium Tax for an indemnity of £10,000. In addition it was “self insuring” ie. there was no premium to pay if there was a claim on the policy. The question the court had to answer was whether the policy premium which the defendant was liable to pay, was reasonable and proportionate.
Master Leonard found the policy was fully compliant with the statutory requirements and the premium of £5,680+IPT was reasonable and proportionate and therefore recoverable in full. This was unaffected by the fact that it covered its own premium (it was “self insuring”).
This is an important benchmark decision on the level of premiums for this type of cover and Claimants can now pursue these actions with the comfort that if the claim is successful then they should be able to recover a substantial policy premium if they obtain an early medical report on liability and/or causation. Box Legal offers a premium well below this figure with a similar indemnity of £10,000.
Please note however that under Section 2.2 of the above regulations, you cannot recover a premium if you never obtain a report on liability/causation. You may, perhaps, not need a report because the issues are clear, or the defendant admits liability/causation. This may leave you in difficulties if you have incurred a substantial premium to cover this risk. Fortunately the ClaimSafe policy brokered by Box Legal permits you to cancel this “recoverable” element of the policy in this situation, so your client will not be liable for this sum.