Is legal expenses insurance worth it?

I am renewing my bike insurance later this month and have a question. Last year I paid extra to include legal expenses insurance.   I haven’t needed to use it and to save money I am questioning if buying legal expenses cover is actually worth it and what it covers?

Sam, by e-mail

Answer

Such insurance policies are known as ‘before the event’ insurance and can protect policyholders by paying legal costs if litigation is required.

These policies can be useful but they are often not fit for purpose and don’t always cover what they should. The most common complaint is insurers refusing to cover the client’s chosen legal representatives rather than the panel of solicitors the insurer has links to.   This can lead to the appointment of a non-specialist firm which can affect the outcome of a claim.

If you choose to take out legal expenses insurance, then it is best to read the terms of the policy carefully to find out exactly what is covered. You should also check if you already benefit from legal expenses insurance on another insurance product such as home contents insurance.

If you choose not to take out a policy, then you will still be able to take out an ‘after the event’ insurance policy should legal action be necessary. These policies are specifically designed for the legal action you are pursuing and will cover you for exactly what is required. They are, however, more expensive.