What You Need to Know about No Win, No Fee Agreements and Their Benefits
There may be a point in your life when you become injured through no fault of your own. The injury or accident might be caused by the negligence of another person or entity, the use of faulty equipment, and more. In such cases, you may be able to claim compensation for your personal injury. But how do you begin your claim, and what should you expect? What if you don’t have the necessary funds for putting a claim forward? This is where the No Win, No Fee agreement comes in.
The basics of the No Win, No Fee arrangement
The No Win, No Fee arrangement began in the 90s and its first function was to help employees bring claims for compensation against their employers. Today, due to some reforms made in 2013, the No Win, No Fee arrangement is divided into two: the CFA (conditional fee agreement) and the DBA (damages-based agreement, also referred to as the contingency fee).
More on the CFA
The CFA, or conditional fee agreement, is an agreement arranged between you and your solicitor. This states that the costs and fees of the solicitor will only be paid if you (the client) win your claim. With this arrangement, a solicitor faces a certain amount of risk because if the claim is not successful, then the solicitor will not receive any fees. In order to reduce this risk, the CFA is designed to provide the solicitor with a success fee if the claim is a success. The success fee will often be a percentage of the compensation received by the client to cover the costs of the solicitor.
More on the DBA
The other type of agreement is the DBA, or damages-based agreement. This is somewhat different from the CFA in that it is an agreement that promises that the client will pay the solicitor if they receive a specific amount of compensation, and the amount paid to the solicitor will be based on the amount of the compensation regardless of the actual fees of the solicitor.
The most obvious difference between the CFA and the DBA is that with a CFA, the fee of the solicitor will depend on the case’s outcome, but will be based on their own fees. In the DBA, the solicitor will ask for a set percentage of the damages regardless of their own fees.
The good news
The good news is that the DBA is relatively uncommon, especially in the UK. Most solicitors will offer a No Win, No Fee arrangement based on the CFA.
So whether you’ve suffered from laser hair removal burns from laser treatment, a machinery accident at work, or whiplash from a car accident, you can take advantage of the No Win, No Fee arrangement without worry, since the benefits far outweigh any risks.