Articles
BTE Cover: The Check That Should Never Have Been Forgotten
Friday 3rd July 2026
Evans v Fletchers is a warning to claimant firms - and a potential new weapon in clinical negligence costs disputes
Checking whether a client has the benefit of Before-The-Event (BTE) Legal Expenses Insurance should be one of the first steps taken when considering how litigation will be funded.
It is not a new requirement. It is not an obscure technicality. It is a basic funding enquiry that can have significant consequences for the client, the solicitor and, ultimately, the paying party.
That is why we have never really understood why some firms appear to have stopped making meaningful enquiries about BTE cover in the first place.
The recent decision in Peter Evans v Fletchers Solicitors Limited [2026] EWHC 1523 (SCCO) brings the issue sharply back into focus. Although the case concerned a solicitor-client assessment, its reasoning is likely to be examined closely in future inter partes disputes - particularly where a receiving party seeks recovery of an ATE insurance premium in clinical negligence proceedings.
There can be little doubt that paying parties will now seek to use Evans to ask a straightforward question. If appropriate BTE insurance may already have been available, was it reasonable to incur an ATE premium at all?
The Consequences Of Failing To Investigate BTE Cover In Evans
The court concluded, on the balance of probabilities, that BTE insurance had been available and that Mr Evans would have used it had he been properly advised.
Senior Costs Judge Rowley found that the success fee would not have been incurred if the BTE policy had been used. The entire success fee of was, therefore, disallowed.
The ATE premium did not formally fall for assessment in those proceedings. However, the judge made his position clear:
“The same reasoning would apply to the ATE policy but that item does not strictly fall for assessment within these proceedings.”
That observation is technically obiter because the premium was not an item the court was required to determine. Nevertheless, it is a clear statement from the Senior Costs Judge that, on the facts of the case, the ATE policy would also have been unnecessary had the available BTE insurance been used.
BTE Enquiries Are Not Supposed To Be a Box-Ticking Exercise
The decision does not impose a requirement for solicitors to embark upon an unlimited search for every conceivable insurance policy.
The Court of Appeal made that clear many years ago in Sarwar v Alam [2001] EWCA Civ 1401. Solicitors are not required to conduct a “treasure hunt”. However, Sarwar also described the proper modern practice of asking clients to provide relevant household, motor and standalone legal expenses policies so that their terms and suitability can be considered.
That obligation was reinforced in Garrett v Halton Borough Council [2006] EWCA Civ 1017, where the Court of Appeal emphasised the importance of making enquiries of potential BTE insurers, even where the client is uncertain about the cover available.
The problem in Evans was not that the solicitors failed to discover an obscure policy hidden away in a forgotten drawer. The client had expressly identified family legal expenses insurance at the outset.
The information was there. It simply was not properly investigated.
Current SRA requirements also oblige solicitors to act in each client’s best interests, provide information the client can understand and place clients in a position to make informed decisions about the available options and the likely cost of the matter.
Why Did Some Firms Stop Checking?
Not every firm has stopped checking for BTE cover. Many firms continue to deal with funding enquiries thoroughly and correctly.
However, across the wider market, BTE enquiries can sometimes appear to have become little more than a question on an onboarding form:
“Do you have legal expenses insurance?” The client may answer that they do not know. A standard letter may be sent to the main household or motor insurer. If an immediate and positive response is not received, the file moves on under a CFA with an ATE policy attached. That is not necessarily a genuine investigation.
The legal expenses insurer may be a separate company from the household insurer. Policy documents may need to be obtained and reviewed. The insurer may need additional details before confirming whether indemnity is available. Questions concerning the insured event, policy period, prospects of success, panel solicitors, freedom of choice and indemnity limits may all require consideration.
A failure to receive a convenient “yes” in response to one standard letter does not necessarily establish that cover is unavailable.
The process should be directed towards finding the answer, not merely creating a file note that says the question was asked.
Why Evans Matters In Clinical Negligence Costs
The recoverability of ATE premiums was largely abolished by the LASPO reforms. However, a limited exception remains in clinical negligence claims.
Under section 58C of the Courts and Legal Services Act 1990 and the Recovery of Costs Insurance Premiums in Clinical Negligence Proceedings (No. 2) Regulations 2013, the part of an ATE premium relating to the risk of incurring liability for expert reports on liability or causation may remain recoverable from the paying party.
These premiums regularly appear within receiving parties’ bills of costs. Until now, many challenges have focused upon the amount of the premium. The Court of Appeal’s decisions in previous cases makes an unsupported challenge to the pricing of a block rated premium difficult.
The paying party must raise a genuine and substantive issue. Challenges to the amount of a block rated premium will generally require appropriate evidence, often including expert evidence concerning the ATE insurance market. A reasonable premium is not simply to be reduced because it appears high when compared with the damages recovered.
However, Evans potentially opens, or at least strengthens, a different line of challenge.
The question may no longer be confined to whether the premium was reasonably priced.
The preliminary question may be:
Was it reasonable and necessary to take out the ATE policy when potentially suitable BTE insurance had not been properly investigated?
That is not necessarily a challenge to the insurer’s underwriting or the macroeconomics of the ATE market. It is a challenge to the receiving party’s decision to incur the premium in the first place.
What Paying Parties Are Likely To Request
Following Evans, paying parties may increasingly seek evidence of:
• the questions asked of the client about existing legal expenses insurance;
• the client’s answers and any completed funding questionnaires;
• the household, motor, travel, employment, trade union or membership policies considered;
• correspondence with the actual legal expenses insurer;
• telephone attendance notes and follow up enquiries;
• the relevant policy wording;
• the insurer’s decision on indemnity;
• any restrictions relating to panel solicitors or freedom of choice;
• the available indemnity limit;
• consideration of top-up insurance; and
• the advice given to the client comparing BTE, CFA and ATE funding.
•
A bare statement that “BTE was unavailable” may no longer be enough where the underlying file does not demonstrate how that conclusion was reached.
A Limited Indemnity May Not End The Enquiry
Another important aspect of Evans concerned the BTE policy’s £50,000 indemnity limit.
It was argued that this was insufficient for a claim of the size and complexity involved. However, the court noted that the £100,000 ATE policy actually obtained would also have been insufficient to fund the matter through to trial.
The Judge further recognised the availability of top up ATE insurance. The existence of a lower BTE indemnity limit did not, by itself, make the BTE policy unsuitable.
That reasoning may be particularly relevant in clinical negligence cases, where firms sometimes dismiss BTE cover because the indemnity appears insufficient for the entire anticipated claim.
The correct approach may be to establish what cover is available, use it where appropriate and consider whether additional or top-up protection is required later. It should not automatically be assumed that an imperfect BTE policy is equivalent to no BTE cover at all.
Receiving Parties Need An Evidential Trail
A receiving party seeking an ATE premium should expect the funding decision to be scrutinised.
The file should demonstrate that:
1. appropriate questions were asked at the outset;
2. relevant policies were obtained where possible;
3. the correct legal expenses insurer was contacted;
4. reasonable follow-up enquiries were made;
5. the terms and suitability of any available BTE cover were considered;
6. the client received clear advice about the available funding options; and
7. the decision to obtain ATE insurance was properly reasoned and recorded.
This evidence should be considered before the bill is prepared, not for the first time after detailed assessment proceedings have commenced.
The Lesson From Evans
Evans is not a clinical negligence inter partes assessment, and it does not automatically render every clinical negligence ATE premium irrecoverable.
Each case will remain fact sensitive. The statutory exception for qualifying clinical negligence premiums continues to apply, and West remains important authority concerning challenges to the amount of block rated premiums.
However, it would be unrealistic to believe that Evans will remain confined to solicitor-client assessments.
Its reasoning gives paying parties a clear basis for examining whether BTE cover was properly investigated before an ATE liability was incurred. Where the receiving party’s file contains no meaningful enquiry, no policy review, no contact with the correct insurer and no clear advice to the client, the recoverable premium is likely to face a serious challenge.
Checking for BTE cover protects the client. It protects the firm. It protects the recoverability of the eventual costs.
It was always an important step. The real question is why anyone stopped treating it as one.
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