Alternatives to Public Provision: The Role of Legal Expenses Insurance in Broadening Access to Justice: The German Experience
| Author | Matthias Kilian |
| Published date | 01 March 2003 |
| Date | 01 March 2003 |
| DOI | http://doi.org/10.1111/1467-6478.00244 |
JOURNAL OF LAW AND SOCIETY
VOLUME 30, NUMBER 1, MARCH 2003
ISSN: 0263-323X, pp. 31–48
Alternatives to Public Provision: The Role of Legal Expenses
Insurance in Broadening Access to Justice: The German
Experience
Matthias Kilian*
The literature suggests that the main barriers to justice
1
range from a
general lack of knowledge about legal rights, and the related prevalent
use of technical language within justice systems
2
(which has led to
commentators describing law as a ‘leviathan’
3
), to a vague ‘fear of
the unknown’.
4
In Germany the principal barrier is thought to be the
problem of funding legal services.
5
Empirical research indicates that
the question of whether or not to consult a lawyer is primarily one of
cost,
6
although over one-third of potential clients have little idea about
lawyers’ fees.
7
To find ways to surmount this barrier is therefore of
paramount importance for a modern society. In broad terms, there are
three potential attitudes to legal costs: reliance on one’s own
resources; hope for third party assistance (such as legal aid or pro
31
ßBlackwell Publishing Ltd 2003, 9600 Garsington Road, Oxford OX4 2DQ, UK and
350 Main Street, Malden, MA 02148, USA
*Universita
¨tzuKo
¨
ln, Rechtswissenschaftliche Fakulta
¨t, Albertus-Magnus-
Platz, 50923 Cologne, Germany
The author would like to thank Pascoe Pleasence for many helpful comments and
assistance in producing a full English text.
1 For the German discussion, see G. Baumga¨rtel, Gleicher Zugang zum Recht fu
¨r alle
(1976); K. Lindemann and P. Trenk-Hinterberger, Beratungshilfegesetz – Gesetz u
¨ber
Rechtsberatung und Vertretung fu
¨rBu
¨
rger mit geringem Einkommen (1987) 8; E.
Fechner, ‘Kostenrisiko und Rechtswegsperre – steht der Rechtsweg offen?’ (1969)
Juristenzeitung 349.
2 K. Redeker, ‘Bu
¨rger und Anwalt im Spannungsfeld von Sozialstaat und Rechtsstaat’
(1971) Neue Juristische Wochenschrift 1153, at 1158, estimates that more than half of
the German population is unable to understand the meaning of most laws.
3 R. D. Sabel, Zur Frage des Verha
¨ltnisses zwischen Bevo
¨lkerung und Organen der
Rechtspflege (1987) 381.
4 id., at p. 382.
5 R. Wettmann and K. Jungjohann, ‘Inanspruchnahme anwaltlicher Leistungen’
Anwaltsblatt, Supplement, March 1987, 18.
6 Wettmann and Jungjohann, op. cit., n. 5.
7 See, in general, K. Mu
¨ller ‘Zur Problematik des Prozeßkostenrisikos im Zivilprozeß’
(1987) Juristische Rundschau 1; A. Mu
¨mmler, ‘Beschra¨nkung des Prozeß-
kostenrisikos’ (1971) Das juristische Bu
¨ro 1.
bono); and insurance. This article concentrates on the last of these
three options, comparing, in particular, the systems in Germany and
England and Wales.
THE CONCEPT OF LEGAL EXPENSES INSURANCE
Although the purpose of legal expenses insurance (LEI) is to provide
protection against the costs of bringing or defending legal action necessary to
resolve a dispute, LEI policies come in many forms, not necessarily limited
to litigation insurance. They can include any kind of legal assistance,
including advice lines.
8
The first country in which LEI products were offered
was France as early as 1905.
9
In the wake of rising numbers of automobile
accidents, LEI became increasingly popular on the continent.
10
Germany’s
first LEI company, began trading in 1928.
11
In the United Kingdom, legal
expenses insurance is a relatively new form of insurance cover, having only
been available since 1974.
12
Indeed, until 1967, when the crime and tort of
maintenance was abolished
13
LEI was unlawful. Even given its relatively
late introduction, set against the example of the continent, the development
of LEI in England is slow.
14
32
8 For some LEI providers, legal advice lines generate a significant proportion of their
business. In the UK, the advice line service can be sold at a very small additional cost
(for example 20p–£1) on top of the LEI premium on a group scheme basis. Sales may
be, for example, to an employer for employees, or a Trade Union. In 1996 there were
620,000 calls to advice lines. This represents an increase of over 160 per cent on the
number in 1990 (data provided by the Association of British Insurers).
9 M. Kilian, ‘Determinanten des europa¨ischen Rechtsschutzversicherungsmarktes’
(1998) Zeitschrift fu
¨r die gesamte Versicherungswissenschaft 23.
10 A.E. Holdsworth, ‘Legal Protection Insurance – The Experience In England’ in Legal
Protection Insurance, eds. W. Pfennigstorf and A. M. Schwartz (1986) at 14.
11 Precursors of LEI have been known in Germany since the nineteenth century when
trade unions, interest groups or societies began providing or financing legal services
for their members. The first society founded for the sole purpose of supporting its
members in legal disputes was a society of shipping companies founded in 1901.
12 Holdsworth, op. cit., n. 10, at p. 14. For England, it has been observed that compared
to the continent there was much less demand for LEI as there were fewer accidents
and more cars insured for accidental damage risks.
13 Criminal Law Act 1967, ss. 14, 15, which arose from the Law Commission,
Proposals for Reform of the law relating to maintenance and champerty, Law
Commission Report No. 7 (22 November 1966).
14 Prais blames a number of reasons: the existence of a comprehensive legal aid system,
insurers’ difficulties in controlling the quality and cost of legal services, and the right
of litigants to appear in person, especially in the small claims court; see V. Prais, ‘The
Future of Legal Expenses Insurance’ (1996) The Litigator 212; V. Prais, ‘A Question
of Insurance’ (1999) New Law J. 1372.
ßBlackwell Publishing Ltd 2003
To continue reading
Request your trial