Insurance solution
ATE-Backed Security
ATE policies supported by a deed of indemnity where the court accepts that structure.
- A judgment or award won
- A judgment against you
- Funder capital deployed
- Law firm fees and WIP
- Security for costsThis cover
- The opponent's costsThis cover
- Disbursements
- Own legal costs
Illustrative. The exposures a dispute can put on a balance sheet. What a policy responds to is set by its wording.
What is ATE-Backed Security?
ATE-Backed Security is a form of litigation risk transfer that may be arranged around security supported by ate and a deed. ATE policies supported by a deed of indemnity where the court accepts that structure. Terms, where available, are set case by case through underwriting.
On this page2 min read
Schedule · specimen
ATE-Backed Security
Not a policy. A specimen to show how this cover is structured. Cover exists only when a policy is issued, on its own wording.
- Terms
- Terms, where available, are set case by case through underwriting.
- Protects
- Security supported by ATE and a deed, depending on policy terms.
- Terms
- Limit, premium and conditions are set by underwriting on the specific risk.
Clause 1
The insured
Who it is for
Claimants who already have or are arranging ATE and want the same policy to answer a security application.
Clause 2
Insuring clause
What risks can be protected
Adverse costs, with the policy offered as security so that cash or a guarantee is not needed.
Clause 3
Operation of cover
How it works
A standard ATE policy may be avoidable if the insured breaches its terms, which is why courts often look for an anti-avoidance endorsement or a direct deed of indemnity to the defendant.
With those in place, courts in England and Wales have in several cases accepted ATE as sufficient security, though each application turns on its facts.
Clause 4
Underwriting
Underwriting factors
The core assessment is the same as for Security for Costs Insurance: merits, quantum, a proportionate budget, recoverability and the legal team.
The points that weigh most for this cover are set out under "What risks can be protected" and "How it works" above.
Clause 5
Proposal documents
Information required
The standard presentation pack described on the Security for Costs Insurance page, plus the documents specific to this cover noted above.
Clause 6
Limit, premium and staging
Potential structure
- (a)ATE plus anti-avoidance endorsement;
- (b)ATE plus deed of indemnity; and
- (c)Limit matched to the security ordered.
Clause 7
Alternatives
Alternatives
Cash, bank guarantee or surety bond.
Clause 8
Territory
Jurisdiction notes
Forum rules apply as described on the Security for Costs Insurance page; the jurisdiction guides linked below set out the position forum by forum.
Specimen for explanation only. Terms, limits and exclusions are set by underwriting on each matter and by the wording issued.
Frequently asked
Why might a standard ATE policy not be enough as security?
Because an insurer can usually avoid a standard policy if the insured breaches its terms, leaving the defendant unprotected. Anti-avoidance endorsements and deeds of indemnity address that risk.
What is a deed of indemnity?
A separate deed under which the insurer agrees to pay the defendant's costs directly if they are awarded, giving the defendant its own enforceable right.
Is ATE-Backed Security available for my dispute?
Availability depends on the merits, the quantum, the costs profile and the counterparty. Every risk is assessed individually and no cover exists until a policy is issued.
Does this quote a price?
No. Pricing is a function of the specific risk and is never quoted in the abstract. Nothing on this page indicates the cost or availability of cover.
Can it be combined with litigation funding?
Frequently, yes. Funding supplies capital; insurance defines the downside. The two are often structured together.
General information only. This page is not legal, financial, investment or insurance advice. Any insurance is subject to underwriting and to the terms of the policy wording issued.