What is no win no fee?
Before you purchased your insurance cover or even after having made the purchase you must have heard insurers or even some insured persons talking of having a no win no fee agreement. This is an industry jargon whose rise has been phenomenal over the years. For those who are new to the insurance industry then you will be hearing these words more often and you would probably like to understand its origin and its applicability.
No win no fee traces it origin in the year 2000 when the legislation relating to personal injury insurance claims compensation was changed. Originally it was known as the conditional agreement. As a result of the change in legislation relating to insurance claims solicitors came up with the idea of no win no fee to allow the insured persons to follow through their claims. This is because the new legislation relating to lodging of claims made it hard for people to lodge successful claims.
Simply stated the no win no fee agreement is entered into by the insured who has suffered an injury he is insured against, with an accident claims solicitor. The personal injury solicitor assists the claimant with legal advice on how to lodge a successful claim. With this agreement the insured is protected against costs that accrue as the fee payable to the solicitor until the full compensation is received. Thus the no win no fee agreement is meant to allow more people to follow through their personal injury claims with their insurance companies.
Depending on where you are the no win no fee agreement can prove to be very useful. This is because in some places you might find that the legislation relating to personal injury claims and compensation allows the solicitor to get his fee from the opponent’s insurance company. Even the cost of the after the event premium for the claimant is recovered from the opponent’s insurance company, thus the client gets his full compensation from the claim.
However there are other fees that are payable by individuals who have a no win no fee agreement if the claim is unsuccessful. The fees payable include;
• Legal costs for the other party
• Your disbursements as well as the other party who is involved in the claim
This is why it is advisable for a person who wants to have a no win no fee agreement to get an insurance policy to cover the above costs before the case starts.