Court fees are climbing. A recent article from Insurance Business Magazine reported that close to 80 new court fees were introduced in Ontario earlier this year (1). This includes seemingly small increases that end up doubling the cost of certain legal services - a price many Canadian businesses cannot afford to pay. Not only will Canadian professionals and companies be paying more fees, but they may also find themselves in court more often. According to the 2018 National Litigation Report by Grant Thornton, 54% of Canadian lawyers expected the volume of legal disputes to increase over the next year. The report also cites emerging industry trends, such as heightened regulation and changing laws, as a factor in this projected increase (2). These developments puts many Canadian associations, small to mid sized companies, and regulated professionals at particular risk of financial disaster - especially in the event of an unanticipated claim. This is why brokers should inform their clients about Legal Expense Insurance (LEI) and how it can offer them affordable access to legal services. LEI Protects Clients Against Claims Other Products Don’t Cover Property owners, professionals, association members, and small to medium sized businesses typically lack in-house legal counsel or access to affordable legal services that cater to their needs. This makes such individuals and entities vulnerable to a number of exposures, for example:
  • Small to medium sized businesses with no HR department could run into employment disputes, contract disputes, or human rights complaints.
  • A landlord could incur thousands of dollars of expense for legal disputes with their tenants or the government - for instance, if their tenant breaches their tenancy agreement, if a former tenant has unpaid rent, if they are prosecuted for someone being injured on the property, or if they face a tax investigation.
  • Police associations, due to the complex nature of their work, are at risk of prosecution for human rights violations, allegations of sexual harassment, or disciplinary proceedings such as a breach of a code of ethics or criminal charges brought against a police officer.
  • Small to medium sized firms as well as regulated professionals are exposed to risk of charges for failure to comply with new laws affecting their business; even with access to legal advice, many businesses cannot keep up with the pace of changing regulations.
Generally, legal expenses incurred due to these sorts of unanticipated challenges aren’t covered by other insurance products such as professional liability/malpractice insurance or commercial liability insurance. That’s where LEI comes in. LEI gives these clients access to legal representation plus covers the costs of pursuing or defending certain legal actions. Providing Affordable Legal Services with Lloyd’s of London Expertise To provide exceptional coverage for our brokers who are serving or interested in serving clients in these markets, South Western Insurance offers our Legal Expense Insurance product in partnership with Legal Expense Insurance specialists at STERLON, CAN-UK Underwriting Services Ltd., and specialist underwriters at Lloyd’s of London. This has given SWG a base of expertise unmatched in Canada by any other company. SWG’s policy covers the following professionals and entities:
  • Small and Medium Canadian Businesses
  • Associations (e.g. gun owners, police, golfers, etc.)
  • Regulated Professionals
  • Condominium Corporations
  • Rental Management companies
  • Physicians & Surgeons
  • D&O policies
  • Senior Care Homes
  • And other identified risks
What Else Clients Get with SWG’s LEI Product SWG provides insureds with access to STERLON’s Telephone Legal Advisory Service. STERLON is the only independent monoline company in Canada dedicated solely to creating and servicing Legal Expense Insurance programs. Established and accredited service providers administer the Telephone Legal Advisory Service and a panel of specialist lawyers act for clients in the event of a claim. For questions and concerns outside of normal business hours, there is also a 24 hour Customer Service. Sources: 1. https://www.insurancebusinessmag.com/ca/news/legal-expenses/legal-expense-insurance-provides-access-to-justice-even-as-court-fees-climb-177498.aspx
  1. https://www.grantthornton.ca/globalassets/1.-member-firms/canada/insights/pdfs/2018-litigation-report.pdf