Your Guide to Making a Compensation Claim → Do I Actually Need ATE Insurance?

You’ve been told you need After the Event insurance. Most solicitors recommend it as standard. But is that advice genuinely in your interests — or is something else going on?

Do I Actually Need ATE Insurance?

Most solicitors recommend it. Most claimants don’t need it. Here’s why.

You were probably told you need it before your claim even started. Possibly before you’d signed anything. A solicitor — or a claims management company — explained that without After the Event insurance, you could face a bill for the defendant’s legal costs if your claim failed. It sounded sensible. It sounded like they were protecting you.

Here’s the truth. For most personal injury claims in England and Wales, the law already does that job. It has done since April 2013. The protection ATE was designed to provide was replaced — deliberately — by a piece of legislation called QOCS. The Jackson Reforms traded one for the other: defendants got the right to keep ATE premiums (no longer recoverable from them), and claimants got a legal shield that prevents defendants enforcing costs orders against them if a claim is lost.

That is not an opinion. It is the statutory framework under which every personal injury claim in England and Wales has operated for the past twelve years. And yet ATE insurance is still routinely recommended — sometimes as if 2013 never happened.

We stopped. In April 2013 — the moment LASPO came into force — Carter & Carter stopped recommending ATE as standard. Not because we had to. Because the client was now the one paying for it, out of their own compensation, for a risk the law had already removed.

What changed in April 2013 — before and after

At a glance — this page

Every claim is unique. Whether ATE is warranted depends on individual circumstances — we’ll tell you honestly whether yours is one of the cases where it genuinely adds protection.

The Legal Foundation: What QOCS Actually Does

Qualified One-Way Costs Shifting is not a legal technicality. It is the backbone of how personal injury costs have operated in England and Wales since April 2013. Understanding it takes about three minutes. It changes everything about whether ATE insurance makes sense for your claim.

The rule is this: Under CPR 44.13, if a personal injury claimant loses their claim, the court will ordinarily not make an order for costs against them that can be enforced by the defendant. The defendant wins the case — but cannot pursue the claimant for their legal bill. That protection is built into the procedural rules. No policy required. No premium deducted. Available automatically to every personal injury claimant in England and Wales.

This was the Jackson Reforms trade-off, designed deliberately by Lord Justice Jackson’s Civil Litigation Costs Review. Defendants would no longer pay ATE premiums if they lost. In exchange, claimants would be protected from costs orders if they lost. One protection replaced the other. The legislative intent was explicit: ATE would become unnecessary for the majority of personal injury claims. That was not a side effect. It was the point.

What the Jackson Reforms did not do was stop firms recommending ATE. And in the years since 2013, a significant number have continued to do so — not because the protection is still needed for most claims, but because of how ATE policies are sold.

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What Actually Changed in April 2013 — and Why It Matters for Your Claim

Before April 2013, if you brought a personal injury claim under a No Win No Fee agreement (formally a Conditional Fee Agreement, or CFA), you would typically take out an ATE policy alongside it. If you won, the defendant paid the ATE premium on top of your damages. If you lost, the ATE policy covered the defendant’s legal costs. The client paid nothing either way. The model worked. Premiums were high — sometimes eye-wateringly high — but the defendant absorbed them, so from the claimant’s perspective the cost was invisible.

After April 2013, that changed entirely. LASPO removed premium recoverability. If you win, the ATE premium now comes out of your compensation — not the defendant’s costs. And QOCS removed the main risk the premium was insuring against. For most standard personal injury claims, the defendant simply cannot pursue you for their legal bill if you lose. The insurance pool that was once pricing that risk is now collecting a premium for a risk that the law has already eliminated.

This is not a criticism of individual solicitors. Most firms that recommend ATE do so because a commercial structure exists at firm level — not because someone sat down and decided to charge clients for something they don’t need. But the effect on the client is the same. Money comes out of their compensation for a policy whose primary justification QOCS removed twelve years ago.

There are genuine exceptions — claims where QOCS protection is reduced or lost, or where a specific disbursement risk cannot be covered any other way. We cover those in detail below. But they are the exception, not the rule. And in most cases, a solicitor who recommends ATE as standard, for every client, is not assessing your individual claim. They are enrolling you in a structure that predates your case.

When Does QOCS Not Protect You? The Genuine Exceptions

QOCS is not absolute. CPR 44.15 and CPR 44.16 set out the circumstances in which QOCS protection is lost or reduced. These are specific and limited — not a general caveat that creates widespread ATE need. Understanding them is how you assess whether your claim is actually one where ATE adds genuine value.

That Part 36 change — the April 2023 amendment to CPR 44.14 — has been cited by some firms as making ATE “even more necessary.” Our view: it is a real change, relevant in genuine contested Part 36 situations, and worth considering where the facts warrant it. What it does not do is justify blanket ATE recommendation across an entire caseload. That argument conflates a narrow procedural amendment with a general risk that applies to every client. It doesn’t.

For a straightforward employers’ liability or public liability claim — where there is no dishonesty allegation, no Part 36 complication, and no strike-out risk — QOCS provides effective protection. No ATE policy is needed. The question to ask any solicitor who recommends ATE as standard is simple: which of these specific exceptions applies to my claim? If they cannot answer that precisely, the recommendation is not based on your individual circumstances.

At Carter & Carter, we assess each claim individually. Chris Carter has been handling personal injury claims since 1993. David Healey since 2005. Combined, that is over 50 years of experience — and enough claims to know the difference between a case that genuinely warrants ATE and one that doesn’t. We will always tell you which yours is. If you want to understand what our clients say about that approach, read what 247 of them have said.

How ATE Insurance Is Actually Sold — The Delegated Authority Scheme

Most personal injury claimants who are signed up to ATE insurance have no idea how the commercial arrangement behind it works. Understanding it takes three minutes. Once you do, the recommendation to take it looks very different.

The mechanism is called a Delegated Authority (DA) scheme. Here is how it operates. An ATE insurer grants a law firm the authority to issue ATE policies on its behalf — at a pre-agreed, block-rated premium — without individual underwriting of each claim. The firm does not assess your specific claim and then decide whether insurance is warranted. The firm has already agreed, at firm level, that every client in a given category will be signed up at a fixed premium. The decision was made before you walked through the door.

The DA scheme model is commercially understandable. An insurer needs volume to make the maths work — the many low-risk claims fund the few high-risk ones. Standard insurance pooling. Nothing inherently wrong with the structure itself. The problem is the context in which it now operates. Before April 2013, the premium came from the defendant. The client paid nothing. The commercial arrangement was between the insurer and the firm — the client was a beneficiary at no personal cost.

After April 2013, the client became the one paying. The premium moved from the defendant’s costs to the client’s damages. The commercial arrangement remained exactly the same — block-rated, pre-agreed, no individual assessment. But the person funding it changed completely. The many are now personally funding a pooled arrangement whose primary purpose — protection against adverse costs — the law already delivers for free under QOCS.

Carter & Carter operated a DA scheme before April 2013. We know exactly how the arrangement works — from the inside. At the time, it was a fair model: premiums were recovered from the defendant, clients bore no cost, and the insurance served a genuine purpose. The moment LASPO came into force and the premium moved to the client’s damages, we stopped. Not because the rules required it. Because the client was now paying for something they didn’t need.

We have not operated a DA scheme since April 2013. We receive no commission from ATE providers. When ATE is recommended — which is not often — it is because an individual assessment of that specific claim has identified a genuine gap that QOCS does not cover.

What the Solicitors Regulation Authority Found

The Solicitors Regulation Authority (SRA) — the regulatory body for solicitors in England and Wales — has conducted a thematic review of high-volume consumer claims, specifically examining how ATE insurance is arranged and sold. The findings are documented on the SRA’s own published guidance pages. They are not comfortable reading.

The 43% figure deserves to sit on its own for a moment. Nearly half of clients reviewed were signed up to an ATE policy without being shown the policy documentation first. That is not a minor administrative gap. Under the Insurance Distribution Directive, a client must be provided with an Insurance Product Information Document (IPID) before the policy is arranged. Forty-three per cent were not. They were enrolled in a commercial arrangement they had not been given the information to assess.

The premium figures are equally striking. Industry research has documented cases where clients were charged premiums of £500 or more for policies with a genuine market rate of £25–£50 — a differential the SRA has confirmed warrants regulatory scrutiny.That gap — up to a 20x difference — does not represent enhanced protection. A £500 premium does not insure you against a risk 20 times greater than a £25 premium. It reflects the commercial structure of the arrangement: block-rated, pre-agreed, with the premium set at firm level rather than based on your claim’s individual risk profile.

None of this means that every firm recommending ATE is acting improperly. The SRA findings reflect a range of practices. But they confirm what the structure of DA schemes makes inevitable: when the decision to issue a policy is made at firm level before the client arrives, individual assessment is structurally impossible. The interests being served are the interests of the commercial arrangement, not necessarily the interests of the individual claimant.

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The Part 36 Problem — And Who Actually Makes the Decision

The strongest argument for keeping ATE insurance after 2013 is Part 36. A defendant makes a settlement offer. You reject it. You go to trial and fail to beat it. Under the 2023 amendment to CPR 44.14, costs consequences follow — and QOCS doesn’t fully protect you. It’s a real risk, and it’s the argument most often made when firms justify recommending ATE today.

Most claimants assume that if a Part 36 offer arrives, the decision about whether to accept it or fight on is theirs. It feels like it should be. It’s your claim, your compensation, your call.

Under a Delegated Authority scheme, that isn’t quite how it works.

When a significant Part 36 offer arrives, your solicitor has a contractual obligation to report to the ATE insurer. The solicitor assesses the position and files that assessment. The insurer reviews it — and if they conclude the risk of fighting on is too high, they withdraw cover. Without cover, almost no one fights on uninsured. The decision that felt like yours has already been made, by a commercial arrangement you were never told existed.

This is not a criticism of individual solicitors. Most will give you their honest assessment of a Part 36 offer and report it faithfully. The problem is structural: the protection you paid for can be withdrawn at the exact moment the Part 36 risk you insured against becomes real.

At Carter & Carter, we assess every Part 36 offer individually — on its merits, for your claim, with nothing else attached to that advice. If you want to understand how we handle that conversation, call Chris or David directly on 0800 652 0586.

When ATE Insurance Is Genuinely Warranted

This page is not an argument that ATE insurance is never needed. It is an argument that it should never be assumed. There are specific circumstances where an individual assessment of a personal injury claim will identify a genuine protection gap that QOCS does not cover — and where ATE adds real value. Those circumstances exist. They are simply far less common than the rate at which ATE is recommended.

Notice what is absent from that list: a standard employers’ liability claim. A road traffic accident. A slip and fall in a supermarket. A straightforward public liability claim. These are the claims that make up the vast majority of personal injury caseloads across England and Wales — and they are the claims most routinely enrolled in DA scheme ATE policies. They are also, in most cases, precisely the claims QOCS was designed to protect.

These questions are not on any other ATE insurance guide. That is not an accident. They require a firm to account for a commercial arrangement that most would prefer clients did not examine too closely. We are putting them here because we believe you have every right to ask them — and because we can answer every one of them ourselves without difficulty.

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How Carter & Carter Handles This

We have been straightforward about our own history on this page. We ran a Delegated Authority scheme. We know how it works because we operated one. Before April 2013, it was a fair arrangement — the premium came from the defendant, the client was protected at no personal cost, and the insurance served a genuine purpose.

When LASPO came into force in April 2013, the premium moved. The client became the one paying. We stopped. That is not a complicated decision when you look at it clearly — but it did mean walking away from a commercial income stream. We have not received commission from an ATE provider since April 2013.

The formal name for our arrangement is a Conditional Fee Agreement (CFA). You sign this before we start. It states clearly: if we lose, you pay us nothing. No upfront costs. No ongoing charges. No bill if your claim doesn’t succeed. That has been our promise since 2007 and it is legally binding — we cannot charge you anything unless we win. We absorb losses ourselves if claims fail. That is why we are selective about which claims we take on. If we are confident enough to take your claim on No Win No Fee, we believe you will win.

When your claim settles without court proceedings — and approximately 99% of our claims do — our fee is 10% of your compensation. If court proceedings are necessary, our fee is 25%. We charge based on what the work actually involves, not the maximum the rules allow.You can see exactly what you will pay before you decide.

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Page last updated: March 2026 | Carter & Carter Solicitors, Whaley Bridge, Derbyshire | Regulated by the Solicitors Regulation Authority