How Do Lawyers Get Paid When You Pursue A Personal Injury Claim?

One of the questions I am asked when clients are considering whether or not to pursue a personal injury claim is ‘how do you get paid?’ Paying a lawyer sounds like an expensive prospect, particularly for potential client who has no income because they have not been at work following an accident.

The general rule

The general rule in personal injury claims is that the ‘losing’ party pays the ‘winning’ party’s costs. So, if you bring a personal injury claim and are awarded compensation then you can expect some of your legal costs to be paid by the other party.

Costs in personal injury claims are assessed in one of two ways, depending on the amount of compensation that is ultimately awarded:

• There is a fixed costs regime for claims valued between £1,000 and £100,000. Whether or not your claim is subject to fixed costs will depend on both the value of the claim and the date of the accident as the fixed costs regime has recently been expanded to include claims valued between £25,000 and £100,000

Or

• The costs will be assessed on a standard basis which will involve a Bill of Costs being drawn up and sent to the other party. The parties then attempt to agree on a figure but if no agreement can be reached then a costs judge will decide on the amount to be paid.

Any expenses incurred over the course of a claim, such as medical expert fees or Court fees, will be paid in addition to the legal costs.

In the vast majority of cases the amount a lawyer receives in costs from the other party does not cover the amount of work they have done in order to bring the claim to a successful conclusion. So, does this mean a client has to write a cheque for the rest? In the majority of cases, no it doesn’t.

How do I pay?

A lot of people who bring personal injury claims decide to fund their claim by way of a Conditional Fee Agreement (CFA), or as you have more likely heard of it, a ‘No Win, No Fee’ Agreement.

CFAs are generally supported by a policy of After-the-Event Insurance which is an insurance policy taken out on a client’s behalf which protects them from having to pay out for the other party’s costs if they lose their claim and a costs order is made against them.

Entering into a CFA means that your lawyer will only get paid if you win your claim. The shortfall in costs as well as the insurance premium and the lawyer’s success fee will generally be covered from a deduction from a client’s compensation which will be agreed at the start of a claim.

What happens if I don’t win the case?

If your case is unsuccessful where the claim is funded by a Conditional Fee Agreement, then your solicitors will not charge you for the work that has been carried out of your behalf and the After-the-Event insurance policy will cover any costs or expenses that need to be paid (subject to the terms and conditions of the policy).

There are other ways that a personal injury claim could be paid for such as:

• Paying privately – this is generally not advisable as a CFA with after-the-event insurance offers greater protection from having to pay another party’s costs if a claim is unsuccessful
• Legal Expenses Insurance on car or home insurance policies or credit cards – most legal expenses insurers will refer you to a firm of solicitors however whether they can assist would be subject to the terms and conditions of the policy

So, worries about how you will pay legal fees should not stop you from pursing a claim for compensation.

If you have been involved in an accident and are unsure whether you should make a claim and wish to discuss your options with our leading personal injury solicitors, please call us today on 0330 822 3451 or request a call back online.