Reasonableness of the premium

The removal of legal aid for personal injury claims and its replacement by conditional fee agreements and after the event (ATE) insurance (taken out by the claimant to cover the risk that his claim will fail and that he will be required to pay the defendant’s costs as well as his own) has generated a good deal of satellite litigation on the recoverability as costs by the claimant of the sums expended on these funding mechanisms. Section 29 of the Access to Justice Act 1999 permitted the court to award the amount of an ATE premium to a successful claimant, and Parts 43.2 and 44.3B of the Civil Procedure Rules (supplemented by Section 11 of the Costs Practice Direction) provide that insurance premiums are recoverable by way of costs in so far as the premiums are reasonable. In Rogers v Merthyr Tydfil County Borough Council [2006] EWCA Civ 1134 the Court of Appeal considered the reasonableness of a three-stage premium, which was at the outset block-rated but was individually assessed once the case progressed to trial.