Accessing Justice Through Legal Expense Insurance: A New Perspective for the Injured Claimant
Legal Expense Insurance is making legal services more accessible and affordable
Litigation has become expensive and time-consuming. Many people are discouraged to litigate because of the high costs and risks of litigation. In Ontario, there are certain options available to promote access to justice. One such example is the introduction of Legal Expense Insurance (LEI). It provides injured claimants with more sense of security to litigate with less concern for the financial risks involved. Legal Expense Insurance is popular in Europe and Quebec and has recently gained some recognition in Ontario.
Justice Karakatsanis has stressed on the need to have access to justice in the recent decision of Hryniak v. Mauldin, 2014 SCC 7,  1 S.C.R. 87,
“[e]nsuring access to justice is the greatest challenge to the rule of law in Canada today. Trials have become increasingly expensive and protracted. Most Canadians cannot afford to sue when they are wronged or defend themselves when they are sued, and cannot afford to go to trial.”
Many Injured claimants are at a risk of facing great financial risk even if lawyers are acting on a contingency fee basis. For example, if a claim is unsuccessful at trial, the injured claimant may end up being responsible for paying the disbursements incurred from both sides and pay the insurance company’s legal bill. (which could be very significant)
Legal Expense Insurance can help the injured party proceed to litigation without the fear of losing and facing significant financial problems. LEI can protect those pursuing personal injury claims by covering any legal costs that a claimant might otherwise have to pay out of their own pocket if the claim is unsuccessful. The Law Society of Upper Canada has referred to Legal Expense Insurance as a “useful insurance product, with the potential to make legal services more accessible and affordable”. Moreover, LEI also serves as an important tool to reduce the financial power imbalance between the injured plaintiff and the Insurance Company. It seems to be a good idea that the insurance industry and its regulators should support a greater sale of LEI as part of more standard insurance products.
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