How Do “No Win No Fee” Compensation Solicitors Make Money?

‘No win, no fee’ agreements are a legally binding contract between claimant and solicitor. They stipulate that should a claim lose, the claimant doesn’t have to pay any of their own solicitor’s fees. ‘No win, no fee’ agreements are also known as ‘conditional fee agreements’.

The no win, no fee system was introduced by the government in 1990 by the Courts and Legal Services Act, and implemented in courts in England and Wales in 1995. In 1998, the no win, no fee practice was extended to all civil cases in the United Kingdom. And thus, the claims industry as we all know it today was born.

The basic feature of the conditional fee agreement is that should a claim be successful, the solicitor is paid for hours worked (solicitor’s fees) and in most cases that they also receive a percentage of the compensation, otherwise known as a ‘success fee’. By law, the success fee must not exceed 100% of the solicitor’s fees. So if solicitor’s fees come to £500, then the solicitor cannot take more than £500 as a success fee.

If a claim is unsuccessful, the solicitor does not get paid. Hence, many people believe that solicitors take on the cases that they feel will be easier to win, in order to maximise their own income. If a claim is unsuccessful, the ugly side of no win, no fee agreements for the claimant is that they will be expected to pay the other side’s legal costs. Bearing in mind these can stretch into the thousands of pounds, it’s always important to consider whether or not going ahead with a claim is wise, taking into account the strength and legitimacy of your case. To minimise this risk, there are insurance policies that you can take out.


And so to answer the question, no win no fee compensation solicitors only get paid if they win their cases, in which case they are paid for their time plus in most cases a success fee.

It’s important to remember that it’s the responsibility of your solicitor to clearly explain to you their fees. This should be explained in the conditional fee agreement. So before you sign anything, ensure that you know what you are getting into. It’s also important to consider that all lawyers have their own rate – some will charge more than others, so it’s definitely worth researching to find a solicitor who you feel charges at a fair and proportionate rate.

If you are considering making a claim with a no win no fee compensation solicitor, get in touch with UK Claim Lawyers. Click here to find out more or call 0800 157 1438.

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