Fact sheet number twelve (a)

An Introduction to Legal Expenses covering Contract Disputes

Within the Commercial Legal Expenses contact underwritten by Abbey Legal and offered to all scheme policyholders there is an additional section of cover for Contract.  This costs more but does provide the policyholder with cover for any contractual disputes arising from their business.

NB:  We consider this to be an especially valuable option for trainers or tutors offering complex and detailed courses, which could result in substantial losses where training disputes aren’t amicably resolved.

Contract cover – the cost

We agreed a compromise with Abbey Legal whereby we would offer the extra cover to everyone on the understanding that if it isn’t required, it can be set aside.  On this basis the standard cost including Contract cover is £95.40 inclusive of insurance premium tax @ 6% but various discounts are available to associations, schools or training groups, as with the Malpractice cover and the standard Legal Expenses package.

Contract – the cover

This provides for disputes with suppliers, customers and clients concerning any contract for the sale or supply of goods or services provided that: –

  1. The amount in dispute exceeds £ 250.00
  2. If the dispute relates to monies owed, a designated debt collection service be appointed within 30 days to act on a ‘no win, no fee’ basis
  3. Legal Expenses incurred in the pursuit of any claims or legal proceedings shall be limited to 75% of the amount in dispute

Contract – policy exclusions

  1. Contracts where the rights or liabilities are incurred through an agent
  2. Employment contracts
  3. Construction contracts
  4. Contracts governed by the Consumer Credit Act 1974
  5. Contracts for the use of your property