No Win No Fee vs Legal Expenses Insurance — Which Should I Use?
Last reviewed: June 2026 · EA Personal Injury Solicitors
With no win, no fee, you pay nothing if the claim fails, but a success fee (capped at 25% of general damages and past losses) is deducted if you win. Legal expenses insurance, often bundled with home or car cover, pays legal costs without that deduction. Check your policies first; if LEI covers your claim, it is usually cheaper.
TL;DR — Quick Summary
Key Points
- Check all your insurance policies — LEI is often included in home and motor policies without policyholders realising.
- If LEI applies, you may keep your full compensation without a success fee deduction.
- No win, no fee is widely available and requires no upfront check — your solicitor bears the risk.
- LEI policies have funding limits and the insurer must approve your claim.
- You have a right to choose your own solicitor once court proceedings have been issued — even with LEI.
- A specialist solicitor can help you decide which funding route is better for your specific case.
Before-the-Event Legal Expenses Insurance — What to Look For
Before-the-event (BTE) insurance — commonly called legal expenses insurance (LEI) — is a policy you take out before you need it, often bundled into your existing cover. Common sources include:
- Home insurance — many household policies include LEI as standard or as an add-on
- Motor insurance — often included in comprehensive car and motorcycle policies
- Trade union membership — many unions offer free legal assistance to members for work-related claims
- Bank accounts — packaged bank accounts frequently include LEI
- Credit cards and travel insurance — some policies include legal assistance elements
Check every insurance policy you hold — and those held by other household members — before deciding on funding. You may already have cover you are not aware of.
Side-by-Side Comparison
| Factor | No Win, No Fee | Legal Expenses Insurance |
|---|---|---|
| What it is | Agreement with your solicitor — they take a success fee if you win | Insurance policy covering legal costs (often already held) |
| When it starts | When you instruct a solicitor under a CFA | Policy already in place before the accident |
| Cost if you win | Success fee deducted from compensation (max 25% of general damages) | Usually nil from compensation — costs paid by insurer |
| Cost if you lose | No solicitor fee (if CFA complied with); ATE covers other costs | Insurer covers legal costs up to policy limit |
| Funding limit | No limit — solicitor bears risk | Policy cap (typically £50k–£100k) |
| Choice of solicitor | Your free choice of SRA-regulated solicitor | May be restricted to insurer's panel until proceedings issued |
| Where to check | Speak to a no win, no fee solicitor | Check home, car and trade union policies |
| Best for | Any PI claim — widely available | Works well if policy limit is sufficient and claim is approved |
How No Win, No Fee Works in Practice
Under a Conditional Fee Agreement (CFA), your solicitor agrees to handle your claim without charging you fees unless it succeeds. The solicitor carries the financial risk. If the claim succeeds, a success fee — agreed before you sign — is deducted from your compensation. The success fee is capped at 25% of the general damages and past losses element of your award; it cannot be applied to future care or future earnings.
Solicitors will usually also recommend After-the-Event (ATE) insurance alongside a CFA. This covers the defendant's costs and disbursements (court fees, medical report costs) if your claim fails. ATE premiums are typically deferred and only payable on success.
How Legal Expenses Insurance Works in Practice
If your LEI policy covers your type of claim, the insurer will carry out a merits assessment. If they consider the claim has reasonable prospects of success (usually above 51%), they will fund your costs up to the policy limit. In a successful claim, the defendant usually pays your costs — so the insurer is not out of pocket, and you keep your full compensation without a success fee deduction.
The main limitations are: the policy funding limit (which may be insufficient for complex or high-value claims), the insurer's right to require you to use a panel solicitor (though you can usually insist on your own solicitor once proceedings are issued), and the insurer's right to withdraw funding if they form the view the claim no longer has reasonable prospects.
Which Is Right for My Claim?
There is no single answer — it depends on whether you have LEI, what your policy covers, and the nature of your claim. As a general guide:
- If you have LEI that covers your claim type and the funding limit is adequate, LEI often preserves more of your compensation.
- If you do not have LEI, or the insurer refuses cover, a no win, no fee agreement with an ATE policy is the standard route and provides strong protection.
- For high-value or complex claims (serious injury, mesothelioma, catastrophic injury), the insurer's panel solicitor may not be the most appropriate choice — asserting your right to a specialist from the outset is worth discussing.
Always tell your solicitor about any LEI policies you hold at your first enquiry. They are obliged to advise you on the most appropriate funding arrangement for your case.