What Is Cost Insurance—And Should You Consider It?
If you’re involved in a personal injury or wrongful death claim in Ontario, you may hear your lawyer mention something called cost insurance (also known as “after-the-event” or ATE insurance). At Auger Hollingsworth, we offer all our clients the opportunity to obtain this type of protection—and we believe it’s worth understanding from day one.
Here’s what it is, how it works, and why it may be a smart decision for your case.
What Is Cost Insurance?
Cost insurance protects you in the unlikely event that your case goes to trial and you lose. In Ontario, the losing party in a lawsuit is generally ordered to pay a portion of the other side’s legal costs. That means if you lose your case, you could be responsible for paying thousands of dollars in costs to the defence—on top of your own expenses.
ATE insurance covers those potential court-ordered costs. It gives you peace of mind that if the case doesn’t go your way, you won’t be left with a large bill.
Who Pays for It?
The policy is typically purchased at the beginning of your case, and the premium (often in the $1,000–$3,000 range) is usually only paid if your case settles or you win. If your case is unsuccessful, the insurance company may waive the premium. In many cases, this premium is treated as a recoverable disbursement and is added to your legal costs claim—meaning it can often be reimbursed as part of your settlement.
At Auger Hollingsworth, we explain how cost insurance works and help you arrange it if you choose to proceed. We do not profit from these policies—they are offered solely for your protection.
Is It Required?
No, it’s optional—but strongly recommended in many cases, particularly where:
- The injuries are serious
- The case may go to trial
- There are complex liability or causation issues
- You’re worried about financial risk
Peace of Mind While You Focus on Recovery
No one goes into a case expecting to lose. But as experienced trial lawyers, we believe in planning for every scenario. Cost insurance gives our clients the confidence to proceed without fear—knowing that they’re protected if things don’t go as planned.
If you’ve signed with Auger Hollingsworth and want to know more about ATE coverage, just ask your lawyer or law clerk. We’ll explain your options clearly and make sure you’re supported—legally and financially—throughout your case.
