Common methods of funding—including CFA and DBAs before 1 April 2013
Common methods of funding—including CFA and DBAs before 1 April 2013

The following Practice Compliance practice note provides comprehensive and up to date legal information covering:

  • Common methods of funding—including CFA and DBAs before 1 April 2013
  • Key terms
  • General regulatory requirements
  • Terminology
  • Indemnity
  • Indemnity principle
  • Private client
  • Legal expenses insurance
  • Conditional fee agreements dated before 1 April 2013
  • Damages-based agreement before 1 April 2013
  • More...

This Practice Note provides guidance on the most common types of funding. It is not the intention to give a full explanation of the legal and regulatory requirements for each funding type.

Key terms

ABSalternative business structure regulated by the SRA—characterised by the involvement of non-lawyer owners and/or managers
ATE insuranceafter the event insurance
CFAconditional fee agreement
DBAdamages-based agreement
firmsolicitor practice or ABS
LAALegal Aid Agency
LEIlegal expenses insurance
solicitor practicesole practice, partnership, LLP or company owned and managed by lawyers
SRASolicitors Regulation Authority

General regulatory requirements

You must ensure clients receive the best possible information about:

  1. how their matter will be priced and

  2. the likely overall cost of the matter and any costs incurred—at the time of engagement and when appropriate as their matter progresses

You must give clients information in a way they can understand. You must also consider and take account of your client's attributes, needs and circumstances.

For details of other general regulatory requirements on costs information for new clients see Practice Note: Information on costs—law firms—2019.


The word indemnity is used in different ways in the context of costs and funding. This often causes confusion. Before discussing different types of funding, it is necessary to explain what these terms mean.


An indemnity arises where a third party agrees to indemnify some or all of the client's costs. Legal expenses insurance is a common example.

Indemnity principle

The indemnity principle

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