LEGAL EXPENSES SCRUTINY: Probe of Legal Expenses Insurance providers operating in Scotland’s legal services market – reveals lack of regulation, insurers going back on agreements to pay legal fees & an in-house complaints system designed to protect insurers against clients

22 Feb

Files show Insurer agreed to pay claim INVESTIGATIONS of cases funded and managed by Legal Expenses Insurers operating in Scotland – suggest insured clients are not adequately protected by Scotland’s legal regulator the Scottish Legal Complaints Commission (SLCC).

Files made available to the media across several Legal Expenses Insurance cases reveal on many occasions – client’s insurance policies end up being charged wild fees of tens of thousands of pounds at a time with little or no work to show

And, insured clients – from members of the public to business owners – often see their legal expenses insurer underwritten policies turned against their own cases and litigation – by solicitors and member law firms of the Law Society of Scotland & Advocates and Kings Counsel of the Faculty of Advocates.

Documents handed to journalists show clients are often forced to take poor & inadequate legal advice, with some clients intimidated by their own legal teams into signing secrecy agreements & walking away without settlements, clients litigation fees & insurance policies ripped-off on an industrial scale.

In one case currently under investigation, a Legal Expenses Insurer and several law firms appointed to represent a claim, appear to have spent nearly forty thousand pounds of the client’s insurance policy – with absolutely no result for the client, other than the inaction & delays resulting in potential time bar affecting certain parts of cases.

A case example currently under investigation by journalists reveals a named Legal Expenses Insurance provider appointed a series of law firms to represent a claim, in which a named KC of some seniority gave advice on expectation of loss of contracts and loss of business in relation to an identified Scottish public authority.

And during a meeting with the Counsel who was confident in his advice, the audio of which has been made available to legal regulators – the Kings Counsel clearly stated litigation should commence on certain aspects of the claim, yet for unexplained reasons, the law firm assigned to represent the claim failed to act.

Files from later dates within the same case identify additional law firms assigned to the claim by the Legal Expenses Insurer – however additional audio from meetings which has been handed to legal regulators reveals bizarre conversations with legal representatives who refuse to consider evidence and material obtained via Freedom of Information legislation.

The files – which currently cannot be published for legal reasons – then show delays and inactivity of hundreds of days where law firms are withdrawn from acting, then another law firm achieves an outcome relatively easily, then a new law firm refuses to act – leading to the Legal Expenses Insurance provider authorising the client to obtain legal representation due to there not being any alternative panel solicitors to represent the claim.

A communication to the client of 27 May 2022 – which has been made available to journalists – reads as follows “Please provide the contact details of the solicitor you wish to appoint so we can make contact with them. You have already exhausted our panel solicitors so we are unable to appoint another panel solicitor.”

An examination of documents appear to show indemnity for the claims associated with the case was never withdrawn by the Legal Expenses Provider.

Files then show a new law firm was approached by the client, with the permission and backing of the Legal Expenses Insurer.

Once work commenced via the latest law firm, the insured client presented fee notes to their Legal Services Insurance provider, which obtained the following email response dated 6 December 2022: “As agreed with your solicitor, they will be invoicing us for their costs upon conclusion of the claim”

However, after a series of disputed opinions, and issues raised in relation to conflict of interest which are now being investigated by journalists – the latest law firm withdrew from acting in the case after providing a new Counsel’s opinion which is directly at odds with two other opinions issued by Kings Counsels in the same insured claim.

This case which is subject to an ongoing media investigation illustrates how poorly clients of Legal Expenses Insurers are treated in Scotland, with a complete lack of oversight and regulation of the insurers activities.

It is highly likely parts of the case featured in this article will end up in the Scottish Courts, where some of the very detailed evidence of wrongdoing within Scottish public authorities, and a series of less than coincidental acts by members of Scotland’s legal profession delayed any earlier litigation in the case – as specified by the original Kings Counsel who was first consulted over two years ago.

Legal Expenses Insurers, like all other financial services providers operate in-house complaints processes which almost always are used by the provider to whitewash any wrongdoing – as clients, consumers and regulators are very familiar with over the decades.

Comment on this article and an ongoing media investigation into consumers experiences with Legal Expenses Insurers will be sought from the Scottish Court & Tribunals Service, and Scots legal regulators.

If you have been subject to poorly treated by a Legal Expenses Insurance provider, journalists would be interested to hear your experiences. Please contact the blog via


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