Ignite Specialty Risk, a provider of litigation risk insurance, has expanded into the European Economic Area (EEA), making its products available to insureds in the region.
The expansion, which builds on the company’s existing presence in the UK and the US, responds to increased demand for litigation insurance in Europe, following legislation introduced by the European Union in 2020.
“Expanding into the EEA is a significant step for Ignite,” said Jamie Molloy, head of Ignite’s After the Event (ATE) product and co-founder of the company. “The growing demand for specialist litigation insurance in the region reflects the increasing importance of accessible risk-transfer solutions.”
Meanwhile, CEO and co-founder Byron Sumner said that the company aims to deliver customised solutions for the EEA market. “This strategic step reinforces our commitment to empowering businesses and legal teams with the tools to manage litigation risks effectively.”
Litigation risk insurance (LRI) is a customised policy that insures against specifically defined litigation risks that may yield uncertainties in terms of the outcome of the case. In contrast to conventional legal expenses insurance, LRI insures against known risks, including pending court or arbitration proceedings.
According to Dr. Burkhard Fassbach, LRI has become increasingly prevalent in the US and in the Lloyd’s of London market in recent years. There are various kinds of LRI, including judgment preservation insurance, which covers the risk of a first-instance judgment being overturned on appeal, and adverse judgment insurance, which protects parties against the risk of an adverse judgment. There is also ATE, which covers the legal costs that the unsuccessful party has to pay to the other party following the court’s decision on costs.
Dr. Fassbach said that this customised protection from litigation costs is a good risk management tool for companies.
“The advantages of litigation risk insurance can best be summarized with an old saying: ‘In court and on the high seas, you are in God’s hands.’ The insurance solutions provide security for uncertain liabilities with regard to budgets, forecasts and liquidity planning.” He added that in the coming years, more companies will use this product to protect themselves from litigation risks.
