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Work out for yourself what it would cost.
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We compare the offerings of several insurers
An adviser checks whether the cover suits your activities
A premium indication, not personal advice. Prefer to talk it through? Call 072 - 509 24 56.
In brief
The insurance reimburses external costs, not your own time. To the insurer you are the policyholder and not a service provider. If you choose to run the case yourself, you do so at your own expense. The policy only comes into play once an external case handler, an expert or a court fee is involved. For a law firm that is the main difference from other businesses.
Handling starts with the insurer's lawyer. Free choice of lawyer arises as soon as court or administrative proceedings are brought. That follows from Article 4:67 of the Dutch Financial Supervision Act (Wft). When it comes to it insurers do not accept a lawyer from your own firm, because the insured party and the case handler would then be one and the same. So you choose a firm outside your own walls.
What you do use the policy for: employment conflicts with your own staff, discussions about the client-restraint clause of a departing lawyer, tenancy matters concerning the office premises, debt collection from private clients and disputes with suppliers of case management and IT systems. See also the business legal expenses insurance.
What does legal expenses insurance for law firms cover?
The structure of the cover in three parts, with an overview per situation below.
You choose yourself
Modules
The sections that suit your business.
Debt collection
Contracts and suppliers
Employment law and staff
Administrative law and permits
Lawyers
What you get
Legal assistance and legal costs, not compensation for loss.
Your own lawyer on your case
Legal costs included
Advice when a dispute is looming
Know in advance
Limits
Where the cover stops.
A three-month waiting period
Minimum financial interest per case
Maximum external costs
What is covered
Situation
Covered
Collection of an unpaid invoice
Sometimes
A dispute with a supplier over delivery
Yes
A dismissal case or employment dispute
Sometimes
An objection to a permit decision
Sometimes
A dispute that was already running when you took out cover
No
Tax proceedings without that module
No
This overview is general in nature and is not personal advice. What is actually covered, including exclusions, limits and the excess, is set out in the policy conditions and the insurance card (verzekeringskaart) of the insurer; you receive both before you take out cover. Taking out cover without advice? Then read what execution only means for you.
Where things go wrong in practice
Four points that make the difference between a policy that pays out and one that does not.
Your own hours are not insured costs
Legal expenses policies reimburse the cost of legal assistance provided to you. Hours you or your colleagues write on your own case do not fall under that, however real the lost chargeable time may be. That makes the trade-off different from other business owners: the question is not whether you can run the case, but whether it is wise to spend your capacity on it rather than on client work.
Free choice of lawyer, but not from your own firm
As soon as court or administrative proceedings are brought, you may appoint a lawyer yourself; Article 4:67 Wft and European case law interpret that concept broadly. The insurer may cap the reimbursement at a maximum but may not take away your choice. A lawyer from your own firm will not be accepted, however, because the insured party and the case handler would then be the same business. So compare carefully on that maximum for external costs.
The disciplinary complaint runs outside the policy
A complaint that reaches the disciplinary board through the local bar president is not a dispute with an opponent about money but a judgement on how you practise your profession. Business legal expenses policies usually exclude those proceedings or cover them only through an additional section. If you want assistance from a specialist colleague, check in advance whether that can be insured and what cost maximum goes with it.
The client-restraint clause of a departing lawyer
If a member of staff moves to another firm and takes clients with them, there is an employment law dispute about the client-restraint or non-competition clause. That is a classic legal expenses case under the employment law module, with interim relief proceedings a realistic scenario. Watch the waiting period: a conflict already running or foreseeable when you took out the policy remains excluded, even after a switch to another insurer.
The three-month waiting period
A dispute that was already running or was foreseeable when you took out the policy is excluded, even after the waiting period and even if you switch to another insurer. So take out the policy while things are calm. This is very much an insurance you have before you need it.
What does your premium depend on?
The firm's annual turnover. The usual basis of calculation for business legal expenses cover.
Number of lawyers and support staff. Determines the expected volume of employment cases.
Office premises rented or owned. Renting brings the property module into play.
Customers rate our service on four aspects: personal service, service delivery, availability and the outcome. The reviews are collected and published by NH1816 and come from customers who have actually taken out a policy with Finass Advies B.V. or reported a claim.
No. The policy reimburses the cost of legal assistance provided to you, not the hours you or your colleagues write on your own case. An insurer will also not accept a lawyer from the insured party's own firm, because the insured party and the case handler would then be one and the same. If you run the case yourself anyway, that is at your own expense.
Why would a law firm take out legal expenses cover?
For two reasons. The first is capacity: every hour on your own file is an hour that is not chargeable. The second is distance. In a conflict in which you are a party yourself, an independent case handler counts for more than technical knowledge. The policy also covers court fees, experts' costs and the cost of an external lawyer.
Is a disciplinary complaint included?
Usually not. A complaint through the local bar president to the disciplinary board is not a civil dispute with an opponent but a judgement on how you practise your profession, and that falls outside the usual description of the cover. Ask in advance whether an additional section is possible and what maximum for external costs applies to it.
Does a dispute about a client-restraint clause fall under it?
With the employment law module, usually yes. A departing lawyer who takes clients leads to proceedings about the client-restraint or non-competition clause, often as interim relief. It is important that the conflict was not already running or foreseeable when you took out the policy. If it was, it stays excluded, even on a switch to another insurer.
Finass Verzekert is a trading name of Finass Advies B.V. We advise on and arrange non-life insurance on the basis of an objective analysis of several insurers, and receive commission for this from the insurer, which is included in the premium. You pay no separate advice fee. Before you take out cover, we establish your wishes and needs.
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