van Boom, Willem H. --- "Financing Civil Litigation by the European Insurance Industry" [2010] ELECD 853; in Tuil, Mark; Visscher, Louis (eds), "New Trends in Financing Civil Litigation in Europe" (Edward Elgar Publishing, 2010)

Book Title: New Trends in Financing Civil Litigation in Europe

Editor(s): Tuil, Mark; Visscher, Louis

Publisher: Edward Elgar Publishing

ISBN (hard cover): 9781848446854

Section: Chapter 5

Section Title: Financing Civil Litigation by the European Insurance Industry

Author(s): van Boom, Willem H.

Number of pages: 17

Extract:

5. Financing civil litigation by the
European insurance industry
Willem H. van Boom

1. INTRODUCTION

One of the ways in which legal services are financed, and indeed shaped,
is through private insurance arrangement. Two contrasting types of legal
expense insurance contracts (LEI) seem to dominate in Europe: before-
the-event (BTE) and after-the-event (ATE) legal expense insurance.
Notwithstanding institutional differences between different legal systems,
BTE and ATE insurance arrangements may be instrumental if govern-
ment policy is geared towards strengthening a market-oriented system of
financing access to justice for individuals and business. At the same time,
emphasizing the role of a private industry as a keeper of the gates to justice
raises issues of accountability and transparency, not readily reconcilable
with demands of competition. Moreover, multiple actors (clients, lawyers,
courts, insurers) are involved, causing behavioural dynamics which are
not easily predicted or influenced.
Against this background, this chapter looks into BTE and ATE
arrangements by analysing the particularities of BTE and ATE arrange-
ments currently available in some European jurisdictions and by painting
a picture of their respective markets and legal contexts. This allows for
some reflection on the performance of BTE and ATE providers as both
financiers and keepers. What emerges from the analysis is that neither
BTE nor ATE is perfect; the institutional settings in which they operate
seem decisive for their success. There is, however, a specific problematic
issue with the long-term sustainability of some ATE products.


2. FINANCING LITIGATION WITH INSURANCE
ARRANGEMENTS

...