Legal expenses cover and home insurance

What’s legal expenses cover?

Legal expenses cover, also known as family legal protection, is a type of insurance you can buy alongside your home insurance.

It'll protect you against the costs of being sued, or of making a claim against someone.

It’s not compulsory when taking out home insurance, but it’s a standard feature with many policies, and available as an optional extra on others.

According to Defaqto, 26% of 322 buildings insurance policies included legal expenses cover as standard, and 56% listed it as an add-on.

The claim limits varied, but 49% of policies had a maximum indemnity limit of £50,000-£74,999.

For contents insurance, 26% of 357 policies listed included legal expenses as standard and it was available as an option for 54%.^[2]

What’s covered by home insurance legal expenses?

Legal fees cover could include:

• Personal injury
• Employment disputes
• Inadequate service
• Faulty goods
• Boundary disputes and other problems with neighbours
• Tax enquiries or investigation
• Medical negligence
• Legal defence
• Property protection
• Jury service

What’s not covered?

There are a number of common scenarios that aren’t covered by the legal expenses insurance on your home insurance policy.

If the amount in dispute is under a certain value you won’t be covered - in other words, the claim must be worthwhile.

Legal issues involving a car you’re responsible for aren’t usually included in legal expenses cover - if you drive your car into someone’s property, for example. Though you might have cover on your car insurance instead.

When the claim relates to work ordered by the government or local authority, your insurer won’t usually honour legal expenses cover.

Matrimonial disputes and libel cases will not be covered. The same applies to cases that started before the policy was taken out and disputes that can be covered by Legal Aid, such as a criminal trial.

Finally, you might have trouble making a claim if there’s a dispute over the purchase of your house - you must have bought it a certain number of days after taking out the insurance.

Before the event insurance vs. after the event insurance

Before the Event Insurance (BTE Insurance) is a type of legal expenses cover you can purchase prior to an event or incident. It's there to act as a security blanket against an unforeseen event that could lead to legal proceedings.

After the Event Insurance (ATE Insurance) is purchased following an accident or incident. It's usually purchased by a solicitor on behalf of a client, in cases where no Before the Event Insurance cover exists.

Is home insurance legal cover worth it?

Legal expenses cover could be worthwhile if you needed legal assistance following a home accident or event.

On average, a UK solicitor costs around £200 an hour depending on experience^[3]. Without cover, you’d be liable to pay for the cost of the legal fees yourself.

Ultimately, it’s down to you to decide whether legal expenses cover is worth it or not, as it really depends on whether you could afford the legal costs for the types of scenario it covers.

Legal expenses and legal assistance

Your insurer will want to be confident it’ll succeed in proving your case to accept your claim, so you’ll only be offered legal assistance if this is the case.

If your insurer handles your legal claim on your behalf, you’re obligated to accept a reasonable settlement, should this be offered.

If you disagree with your insurer's verdict, you can contact the Financial Ombudsman Service to make a complaint.

Legal expenses versus liability cover

If you’re liable for damages relating to your home, your standard home insurance policy will cover this.

Legal fees cover is useful for taking legal action to reclaim losses that you can’t recover through your standard home insurance policy, such as the excess you pay when making a claim.