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I think there are some good points, Rachel, but I'd like to see some figures before accepting BTE to be some sort of panacea.

My (limited) experience of BTE is they shove you to a panel firm. The terms of the referral from the insurer to the panel firm are :-

1. If it's a good case, with prospects of success and a defendant good for the money (or claimant good for the costs) you can take it on.

2. If no prospects of success, or risk of non recovery of any interest parties costs order, you can't take it on.

3. Ergo, if solicitor wins, they get costs from the other side (and not the insurer)

4. If case loses, and insurer does have a costs risk, panel solicitor is in trouble

5. Ergo, then BTE insurer pushes cases to a panel firm who will only take on absolute cast iron cases.

6. So BTE outlay is funding disbursements, and paying on the cases that slip through the net.

Non panel firms aren't as likely to play the game and will take on good cases with propsects of success but with some risk of losing. Panel firms only take on the 99.9% chance of success cases.

Hence the push to panel firms.

Therefore the "£50,000" legal costs cover is illusory - it is only very rare cases that the insurer will ever have to pay anything out. Fixed costs or no fixed costs, the solicitor is effectively getting whatever they can from the other side / client's damages so it is not the insurer's concern.

That is why the premiums are so low, and why BTE would never be a sufficient replacement for other means of access to justice.

It's a bit like the old civil legal aid cases, except without the bar on costs recovery (BTE would have to pay adverse costs whereas civil legal aid a winning opponent was barred from claiming adverse costs), no statutory charge (where the Legal Aid Board could recover their money back in certain cases, whereas a BTE insurer can't) and without the low own client legal aid rates that solicitors were restricted to where there was no inter parties recovery (whereas a BTE insurer would have to pay Guideline Rates which are three to four times higher).

And despite all these features, the civil legal aid system cost hundreds of millions in its heyday 10 to 15 years ago.

For BTE to fill the void of lost legal aid in civil cases, add all the factors above in, and inflation, and the civil legal aid budget of £600 million would end up having a combined outlay amongst BTE insurers of into the billions, and that isn't going to be achievable on a £25 to £45 premium on a home insurance policy.

There's no real way to turn straw into gold.

Either BTE remains an illusory product that actually covers very little, or the premiums would be so uneconomic as to be not viable.