| Lockton Company (Hong Kong) Ltd. announced the launch of the first "after-the-event insurance (ATE) in Hong Kong."|
Lockton HK works in partnership with the British broker TheJudge, a long established broker in Litigation Risk Transfer Solutions.
"ATE Insurance is a type of legal expenses insurance policy that provides cover for the costs incurred in the pursuit or defense of litigation. The product allows litigants (individuals, corporate or unincorporated entities) to minimize the uncertainties and financial risk," said the magazine .
"The policy is purchased after a dispute has arisen (which is why it is called" After-the-Event Insurance "). This type of insurance in the United Kingdom for more than a decade and has tens of thousands of parties for a significant part of their litigation risk. "
Greg McCoy, CEO of Lockton Greater China, said: "Litigation is a costly business. In fact, potential legal costs can be so daunting that they prevent a financially stressed party from pursuing or defending his legal rights. ATE Insurance exists to provide access to justice for cases with genuine merit. The current economic and financial environment is likely to spawn many such cases."
Loctkon HK explained that "typically, a policy to cover an insured, the liability for his opponents of legal costs should not be the case. It is also famous for its costs incurred. It is possible to make some for the Solicitor's [lawyer] fees. As the policy is legal expenses to compensate, it is not used for any other liabilities arising from litigation.
"Types of cases that are typical for this insurance are: commercial litigation, professional negligence cases, insolvency cases and civil litigation cases."
James Delaney, director of the TheJudge Limited added: "There are two other unique features of this product: Insured and deferred premiums.
"Premiums are usually insured under the policy. If an insured pays for a policy and his suit is unsuccessful, not only do the insurers pay the insured's adverse party & party costs, they also reimburse the insured for the cost of the premium."
In general, the insured has a nominal premium to be paid in advance and nothing more, in the event that the case is not successful. The insured is only liable to pay the full premium in the event that the case succeeds.
The premiums are set individually for each case depending on the financial burden, which by the insurers and their views on the prospects of success.
Delaney says: "Because insurers recognize that early settlements will often occur, there are normally staged discounts in the premium. Like the Courts, the insurers wish to encourage early mediation or resolution of a case where it is in the interest of the parties."
In response to the questions of whether such insurance would be to resolve disputes, he replied: "Despite the attractiveness of this form of insurance for litigants, its availability has not resulted in any significant increase in litigation in the UK despite a 10-year existence. One principal reason is that at the end of the day, it is the insurer who will carry the exposure and they are naturally commercially selective as to which types of cases they choose to support."
"Lockton Hong Kong Launches 'After-event insurance | AboutHK.Com - more information about HK"