After-the-event (ATE) insurers are calling for a seat at negotiations about a new claims process amid fears that the question of when solicitors can take out insurance is back on the table.

The Legal Expenses Insurance Group (LEIG), which represents seven insurers, has written to the Ministry of Justice to seek reassurance either that the issue is not live – or, if it is, that ATE insurers will have their say.

In its original consultation, the MoJ proposed that ATE premiums should be recoverable only if liability is denied or no admission is made. After consultation it dropped the proposal and told ATE insurers that they did not need to be represented in negotiations.

While the Gazette understands that ATE is not yet formally in play, sources say that liability insurers are determined to revisit the issue, threatening to pursue it to the European courts if necessary.

LEIG director Tony Baker argued that ATE initially covers risks such as a failure to agree quantum or causation even if liability is admitted. The MoJ’s proposal would have a ‘dramatic effect’ on the ATE market because it would lead to insurers only covering cases that by definition would be risky.

An underlying principle of the introduction of conditional fee agreements backed by ATE was that ‘the many pay for the few’, allowing solicitors and insurers to make enough money from the winning cases to cover the minority of cases that are lost.

Anthony Hughes, president of the Forum of Insurance Lawyers, described as ‘disappointing’ the ‘dogmatic approach’ of the government to maintaining its policy on ATE ‘without listening to any rational argument’.