Legal expenses insurance for employment law claims
11 August 2021
Legal expenses insurance is included in many car and home insurance policies and can often be used to cover the cost of making an employment law claim. But a lot of people have this cover without realising it. We explain how legal expenses insurance can be used to fund an employment law claim.
What is legal expenses insurance and what does it cover?
Legal Expenses Insurance (LEI) is a type of insurance that will cover the cost of legal fees in specific circumstances, including certain types of employment law claims. Like other types of insurance, an LEI policy needs to be purchased before a claim is made. Some home and car insurance policies include LEI, although it’s also possible to purchase a standalone LEI policy. Some bank and building society accounts also include an LEI policy. In many cases, policyholders might not realise that they have LEI.
LEI policies can be used to cover the costs of most employment tribunal claims, such as unfair dismissal, discrimination and whistleblowing. This means that the legal costs you incur when making the employment tribunal claim will be paid for by your insurers.
However, LEI does not usually cover internal grievances or disciplinary matters that have happened before a legal claim is made. It also doesn't cover legal work carried out before your claim has been accepted by the insurer.
You could have legal expenses insurance without realising
The Legal Services Board (LSB) recently carried out some research into how legal expenses insurance could help to address consumers’ unmet legal needs. They discovered that most people were unaware they had legal expenses insurance and, in particular, that this could be used to cover the legal costs of making an employment law claim.
If you aren’t sure whether you have LEI, you should first check your home insurance, car insurance or bank or building society policy documents.
When can LEI be used to cover employment law fees?
Insurers usually require a claim to have at least a 51% prospect of success for it to be covered by your insurance policy. Our expert employment law team at Co-op Legal Services will be able to advise you on the prospects of your claim and if you can expect your LEI policy to cover the costs incurred.
It is important to have copies of your policy documents to share with your selected employment solicitor, so that they can confirm whether the legal costs are likely to be covered by the policy.
Can I use any employment solicitor I want with LEI?
Your insurer may have a designated panel of in-house solicitors, which they may refer you to for your claim. However, it is important to understand that you do have the right to select your own solicitor, because legally you have the freedom to choose which solicitor you want to instruct.
At Co-op Legal Services, not only do we have qualified solicitors with expertise in employment tribunal claims, our employment specialists are familiar with your right to freedom of choice and with the process of getting LEI funding in place. They will liaise directly with your Insurer on your behalf. This means that we can charge your insurer directly for representing you in your employment tribunal claim, so that you don’t have to cover these costs up front, and also takes away the added stress of you having to deal with your insurer.
What if I don’t have LEI?
If you do not have LEI, we have other funding options available, including a range of fixed fee services. See more information on how to fund your employment law claim.
Get in touch with a member of our team to discuss your claim and the funding options that we have available to help you with your claim.