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Legal Expense Insurance at a Crossroads

May 19, 2020

Nearly two years ago BridgePoint’s Co-Founder Stephen Pauwels wrote an article in the Ontario Trial Lawyers’ Association publication The Litigator entitled “Legal Expense Insurance at a Crossroads”. It highlighted the identity crisis facing the After the Event, or “ATE” insurance market in Canada at the time and many of the predictions have been borne out in the interim:

The case of Peter B. Cozzi Professional Corporation v. Szot, CanLII - 2019 ONSC 1274 (CanLII) highlights the inherent conflict raised between plaintiffs counsel and their own clients where the policy limits are insufficient to cover both disbursements (counsel’s exposure) or adverse costs (plaintiff’s exposure) where the limits are insufficient to cover both. Defendants are attacking the coverage where possible for their own gain - seeking costs where they previously wouldn't (Crannie’s case), in some instances to the point of inciting the judges who are penalizing their hardball tactics (Crannie decision). Uncertainty remains regarding whether premiums are recoverable from defendants, and whether defendants can access policy details, etc.

If lawyers and the courts are confused about the product and its features, what chance do plaintiffs have of understanding what they're being sold? More twists and turns in this ongoing story are to be expected. Click here to read the article.

Click here for a related post written by BridgePoint's Chief Risk Officer and General Counsel, Amanda Bafaro.

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Legal Expense Insurance at a Crossroads
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