The government changed the law drastically last year. The reforms they put in to place have resulted in lawyers being unable to recover all of their fees from the other side, and in addition to this, they slashed the amount of legal fees that can be claimed back to an all time low.
These reforms are now leaving the victim out of pocket because lawyers cannot offer a proper service without having to take a deduction from your claim. But is 35% too much to take? Read on for some more advice.
What’s changed?
The government have stopped lawyers being able to recover their Success Fee and the cost of an After The Event insurance policy from the other side. The Success Fee, as part of access to justice rules, is there to help fund no win, no fee claims. We can’t win them all, and in many cases we do not know if you have a claim unless we actually pursue it. There is always a risk we will lose and not get paid as you shouldn’t get charged on a no win, no fee.
The After The Event insurance is there to cover you from having to pay adverse costs or the fees for disbursements that cannot be recovered. Adverse costs are costs that need to be paid to the Defendant solicitors if something goes wrong – like if we lost at a trial or withdraw the claim as there wasn’t a good chance of continuing successfully. The risk of paying them depends on how far you are with the claim. Disbursements are things we pay out for you with the view to recover them back – like the cost of a medical report or the cost of treatment.
So how much should it cost me now?
The Success Fee can now be recovered from your compensation, and the government capped it at 25%. That means that, whatever the Success Fee is, the lawyer cannot take any more than 25% from your compensation to cover the Success fee.
The insurance could be anything from a few hundred pounds to a few thousand pounds. It can depend on things like the risk of the case and the value of the claim. This is normally paid upfront or as a fixed amount at the end of the claim.
So how can someone charge me 35%?
Well it sounds like that additional 10% is covering something else. From what many clients have told us, we have often found that 35%-40% is common for people who find their lawyer through a claims management company or accident advice service. These are middlemen who simply pass the details of the claim to a solicitor, and charge you for doing it. They add no value to your claim at all, and many websites you will come across, as well as many of the big names that advertise on the TV, are not actually lawyers but are middlemen claims companies.
Even some of the big names that actually have the words “lawyers” or “solicitors” in it and advertise themselves as “real lawyers” are not actually lawyers! You should always ask upfront whether you are going to be passed to someone else or whether you are speaking to a real actual law firm.
By the way, in case you’re wondering, we are an actual law firm – so we advise you and we actually represent claimants for cases!
So do I have to pay as much as 35% and then some for insurance?
No – because dealing with a real law firm like us means that you shouldn’t lose any more than 25% due to the restrictions. On top of that, we can still offer 100% for a minority of cases, and we don’t have to take the full 25% either. We don’t normally charge for insurance in most cases as we self insure and cover you instead.
So speak to us for our best deal possible and you could end up saving thousands and thousands of pounds!
