Professional negligence and professional indemnity insurance (PII) are closely related, and having a working definition of both is helpful before discussing the latter.
When an individual fails to meet general standards of competence in their professional field of expertise, they have committed professional negligence. Examples of this include lawyers who draft inadequate contracts; IT security engineers who implement unsafe networks; and engineers who design structurally unsound buildings. Because all three have fallen below the standards of a reasonable member of their profession, they are potentially liable.
Professionals are naturally worried about the amount of compensation they might have to pay out to claimants for this, so they often take out PII: usually, it is a requirement of their professional body. This means that even if a court finds them negligent, their insurer will pay out. In theory, this is a good thing: professionals frequently won’t have deep enough pockets to pay the full award, and there’s little value in suing somebody with no money. If nothing else, PII guarantees a pay out in the event of loss.
The Problem with PII
But PII is not an unambiguously good thing for would-be litigants – in fact, it can be the undoing of many claims. The reason for this is simple: insurance companies, by nature, hate paying out, and may do everything in their power to avoid doing so.
Making this worse is the fact that they tend to have vast resources at their disposal – and can make life difficult for anyone trying to take a professional negligence claim to court. PII insurers take charge of a defendant’s case themselves, providing them with financial backing and access to quality legal counsel, expert in the relevant area: after all, it’s cheaper than losing. They’re more than willing to play the long game: they know that, in most cases, a less wealthy litigant will – facing ruin, and with no guarantee of success – back down. And in this situation, it’s understandable: not only are claimants struggling to recover from the business costs incurred by the specific incident of professional negligence, but they’re also now faced with the prospect of taking on a much bigger opponent at the same time.
However, it is unwise for litigants to succumb to despair before fully exploring their options. Third party litigation funding, like that accessed through Annecto Legal, allows you to pursue redress while incurring no costs of your own. In exchange for a portion of the final award, you’re supported throughout the entire process.
Firstly, unlike no-win, no-fee (NWNF) arrangements, this support is all-encompassing. A professional negligence claim lives and dies on expert evidence: if you’re suing a doctor for failing to reach the required standard, you need another doctor to explain what that standard is and how the defendant breached it. But expert witnesses are very expensive, and won’t be covered by standard legal fees or NWNF. Alternative finance providers need to ensure your case has the very best chance of success – they don’t get paid if you lose – and so they will fund your expert witnesses as well.
This same impulse will ensure you get the very best legal counsel available. Most people tend stick with the law firms that they know, but very few firms are actually qualified to take on professional negligence claims. If you approach a solicitor that isn’t well-equipped to handle your case, they’re hardly likely to tell you to go to a competitor that knows more! Litigation funders have to be able to draw on a network of lawyers that operate in a variety of different niches – they’re better placed to sort the wheat from the chaff and get you the solicitor you need to win.
More than anything, however, litigation funders provide you with confidence. There are few things more isolating than pursuing a case against a much bigger opponent. But if you have a powerful backer, your case has a legitimacy that cannot be ignored. Knowing that they’ll run up legal costs the longer they defend a case they are likely to lose, PII insurers will frequently be the first to back down.
Not only does litigation funding provide you with the opportunity to seek the justice you deserve, but you could well get the satisfaction of seeing off much larger opponents. What’s not to like?