LFJ Conversation
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An LFJ Conversation with Byron Sumner, CEO and Co-founder, Ignite

Byron Sumner is the CEO and Co-founder of Ignite, a specialist litigation insurer built on its founding members’ significant litigation and reinsurance expertise. Ignite offers large capacity limits on ‘A’ rated paper across various case types, along with an extensive product suite tailored to each stakeholder’s unique needs. Their solutions range from straightforward contract disputes up to multi-billion pound international arbitrations.

Ignite’s mission is to transform the legal expenses insurance experience by providing swift and simplified solutions, transparent communication, tailored problem-solving, and unwavering support to help clients achieve their desired outcomes.

Byron’s experience over the past decade includes a plethora of cross-class responsibilities within the (Re)Insurance industry, having held both analytical and transactional roles at several leading insurance organisations, including Argo Syndicate 1200, Chubb, and Aon. As well as founding an analytics and targeted client acquisition business,

Byron has supported the capacity acquisition, product development, and growth strategies of several market leading MGAs. Byron’s commitment in the co-founding of Ignite is driven by a strong appetite to further develop the harmonisation of Insurance and Commercial Litigation.

Below is our LFJ Conversation with Byron Sumner:

Can you please provide the basics on Capital Protection Insurance (CPI)? At its most basic level, how does it work, whom does it protect, and what are the benefits? 

At its core, a CPI policy safeguards an agreed portion of a funder’s outlay. A CPI policy can be purchased for a single piece of litigation, or across several litigation assets that form a portfolio of investments. Simply put, if the agreed portion of capital is not generated by a specified date outlined in the policy wording, the insurer is obligated to pay a claim in line with the deficit between the funder’s return and the policy’s limit of indemnity. The benefits of CPI go beyond the scope of most conventional insurance products, which primarily focus on the provision of ‘sleep easy’ downside protection. When leveraged efficiently, CPI offers litigation funders the opportunity to unlock a wider pool of potential investment partners and more attractively priced debt capital.

How does the rise of CPI within the legal services landscape impact litigation funders when it comes to their case selection and underwriting approach? 

The CPI policy does not intend to allow funders to dilute their DD approach to cases. Ignite collaborates with top-tier litigation funders who are not only expected to maintain the same high level of DD, whether insured or not, but are also obligated to adhere to specific case selection criteria and other underwriting processes to satisfy the policy’s requirements. Eligible only for discerning customers, Ignite’s CPI policy is designed to be a highly utilisable safety net in the event of an unexpected loss rather than an instrument employed to eliminate legitimate litigation risk in its entirety.

What would you say the interest level is from litigation funders around your CPI product? What sorts of questions are they asking you / what concerns do they have – and how do you allay those concerns? 

Interest in CPI products has steadily increased over the past three to five years. While most prospective insured partners encountered by Ignite are funders seeking to protect a portion of their capital, we now see requests for additional cover such as insured premiums and ‘upside protection’, which involves ensuring the return of a portion of capital in excess of the principal investment (>1X MOIC).

The primary concern of litigation funders and their LPs/financiers regarding CPI revolves around the insurer’s ability to pay a claim in the event of a large loss. This concern is largely mitigated by Ignite’s capacity partners’ A- rating and market-leading internal underwriting team. Through adept policy structuring and procedural stipulation, we reduce the risk of a lost case to a minimum.

When Ignite partners with litigation funders, what criteria are you looking for in your diligence?

Ignite’s DD is extensive, and underwriting portfolio CPI ‘wrappers’ is a more complex, bespoke process when compared to single case, open market policies. Transparency is critical to the process; working in partnership with its prospective customers, Ignite’s underwriting team will initially explore a fund manager’s historical track record, as well as their internal experience and expertise, including that of their investment committee. To gain an early understanding of viability, Ignite’s team also evaluates a funder’s IRR and MOIC expectations underpinned by their assumptions around case success rate and associated recoverability.

How do you see the continuing emergence of insurance products within the litigation funding sector contributing to the evolution of litigation finance over the coming years, and how will Ignite play a role in that ongoing story? 

Utilisation of insurance is still a relatively new concept to many funders, particularly in the context of CPI over more traditional ATE products such as adverse costs cover. I am confident that insurance products will play a significant role in the future of litigation funding and Ignite’s increased receipt of insurance applications unequivocally attests to this upward trend. A CPI policy can not only facilitate a reduced cost of capital for funders, but also unlock the litigation asset class through the utilisation of an investment grade rating for traditionally risk-averse investors such as pension funds and insurance companies. As a result of the growing harmonisation of insurance and commercial litigation, I anticipate a greater influx of appropriately priced capital and access to justice for those claimants/plaintiffs with meritorious claims.

Ignite will continue to play a leading role in this evolution by providing specialist insurance products that fulfil the needs of our customers. Ignite’s offering, which itself is always evolving, aims to work back-to-back with funders on baskets of cases which are cross collateralised, allowing insurers to benefit from the familiar benefits of diversification.

As litigation funders explore new avenues to mitigate risk, the role of insurance products like CPI becomes increasingly significant. Could you share some insights into how Ignite caters to the needs and expectations of litigation funders in this changing environment?

Ignite dedicates a significant amount of time and resources to developing a profound understanding of its target market. The company collaborates closely with some of the world’s premier funders to explore innovative and well-established strategies to assist in the management of their portfolios to utilise their capital more efficiently to drive better returns for all stakeholders. Ignite’s success is intricately linked to the success of its insureds, and this dynamic serves as a solid foundation for future collaborations. For example, this strong working relationship typically manifests in the seamless adaptation of standard policy documentation to cater to the specific individual needs of the funder client. Ignite consistently maintains a sharp focus on delivering a catalyst for an increase in successful case outcomes, which, ultimately benefits plaintiffs and claimants.

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LFJ Conversation

An LFJ Conversation with Stephen Kyriacou, Head of Litigation and Contingent Risk at WTW

By John Freund |
Stephen is a seasoned litigation and contingent risk insurance broker and former practicing complex commercial litigator who joined WTW in February 2025 as Head of Litigation and Contingent Risk Insurance.  In his role, Stephen evaluates litigation-related risks and structures bespoke litigation and contingent risk insurance policies for litigation finance, hedge fund, law firm, private equity, and corporate clients.  Prior to joining WTW, Stephen was a Managing Director and Senior Lawyer in Aon's Litigation Risk Group.  Stephen joined Aon in 2019, and was the first insurance industry professional dedicated solely to the litigation and contingent risk insurance market, leading the Litigation Risk Group's origination and business development work, in-house legal diligence, efforts to advocate for coverage with underwriters, and negotiation and structuring of insurance policies.  During his time at Aon, Stephen was a three-time Risk and Insurance Magazine “Power Broker” (2022, 2023, 2024); spearheaded the development of judgment preservation insurance and insurance-backed judgment monetization as well as the synergy of litigation and contingent risk insurance with litigation finance; and was responsible for placing billions of dollars in total coverage limits – including the largest ever litigation and contingent risk insurance policy, and several policies that each provided over $500 million in coverage limits – and delivering hundreds of millions of dollars in premium to insurers.  Stephen additionally provided consulting and broking services on litigation-driven, insurance capital-based investment opportunities and sales of litigation claims, insurance claims, and subrogation rights as part of the Aon Special Opportunities Group. Prior to joining the insurance industry, Stephen was a complex commercial litigator in the New York City office of Boies, Schiller & Flexner from 2011 to 2019.  While at BSF, Stephen amassed significant trial, appellate, and arbitration experience representing both plaintiffs and defendants in the U.S. and abroad across a wide array of practice areas, including securities, antitrust, constitutional, insurance, first amendment, employment, government contracting, and criminal law, as well as in multidistrict and class action litigation.  Stephen's clients included banks and other major financial institutions, private equity firms, technology companies, foreign sovereigns, professional sports teams, television networks, insurance companies, corporate executives, and other high-net-worth individuals.   Stephen earned his J.D. from the New York University School of Law in 2010, and is a member of the New York State Bar.  He also clerked for the Honorable Tanya S. Chutkan in the United States District Court for the District of Columbia. Below is our LFJ Conversation with Stephen Kyriacou:

We’ve seen increased interest in portfolio-based insurance solutions, particularly as the judgment preservation market has tightened.  What’s driving this shift, and how are clients adjusting their risk strategies in response?

When I first joined the insurance industry back in 2019, after about a decade as a trial and appellate lawyer at Boies Schiller, we were primarily insuring single-case defense-side risks with what we now call adverse judgment insurance or “AJI” policies.  Shortly after I started, the focus shifted to the plaintiff side, though most insurers still preferred insuring single cases with what came to be called judgment preservation insurance or “JPI” policies.  These policies protected plaintiffs who had already won at trial or on summary judgment against appellate risk, effectively guaranteeing a minimum recovery from their trial court judgments no matter what happened on appeal.

JPI was the driving force behind the explosive growth in the litigation and contingent risk insurance market for several years, in large part because these policies allowed plaintiffs to monetize judgments more cost-effectively than they could without insurance.  And as the market grew, so did the size of the judgments that were being insured and the amount of coverage limits that insurers were putting up, both individually and collectively, on these policies.  It got to the point where policies providing over $100 million in coverage for multi-hundred-million-dollar judgments became commonplace, and several policies were written that provided more than $500 million in coverage on billion-dollar-plus judgments.  Individual insurers were also sometimes betting tens of millions of dollars on the outcome of a single case as part of some of these JPI larger policies.

Unfortunately, while more modestly sized JPI policies on smaller judgments have generally performed as expected, with insurers not having to pay many claims, some of these larger, more high-profile JPI policies have run into significant challenges on appeal, on remand, and in places like the Patent Trial and Appeal Board.  And the nature of this insurance is such that one big loss on a multi-hundred-million-dollar policy can more than wipe out the premium gains for insurers on several smaller policies.

The JPI losses that insurers have already incurred, and those they look likely to incur in the near term, have understandably caused many of them to reassess their approach to litigation and contingent risk insurance more broadly.  For some insurers, that has meant pulling back from the space or taking a “back to basics” approach and returning to a focus on defense-side risk.  But for many insurers, it has meant mirroring the pivot that much of the litigation finance industry made several years ago away from single cases – where financial outcomes can hinge entirely on one jury, one trial court judge, or one panel of appellate court judges – and toward a portfolio-focused approach that better spreads risk across multiple diverse cases or litigation-related investments, loans, or other assets.  In fact, the insurers who have come into the market following the JPI boom, and who therefore have no exposure to any of the large JPI policies of recent years, are generally focused, at least for the time being, exclusively on providing this sort of portfolio-based coverage.

Our clients at WTW are embracing this new paradigm.  Where a client may previously have sought to insure a single large patent infringement judgment with a similarly large JPI policy, they might now seek a portfolio-based policy that guarantees a minimum recovery from the combination of that judgment, several other earlier-stage cases that are pending in different trial courts, and numerous other patents they may seek to enforce through litigation in the future.  We’re also working with litigation funders who may previously have sought to insure individual investments on a piecemeal basis once they reached the judgment stage to instead insure portfolios of diversified investments throughout all stages of the litigation lifecycle, including in some cases entire funds or designated sleeves of funds.  Patent and mass tort case aggregators are also increasingly looking to avail themselves of portfolio-based insurance solutions that can be tailored to the unique risk profiles of their businesses and used as a financial tool to spur growth and increase profitability.

Law firms are getting in on the action, as well.  We are seeing tremendous interest in “work-in-progress” or “WIP” wrappers that insure, on a cross-collateralized basis, a law firm’s anticipated contingency fee recovery across a portfolio of cases.  Many of the recent WIP insurance placements that we’ve worked on recently have involved patent infringement cases and IP litigation boutiques, but we are also seeing interest from mass tort, personal injury, and product liability law firms, as well as among AmLaw 200 firms that focus on many different categories of high-value, capital- and labor-intensive plaintiff-side commercial litigation.

Can you walk us through what a portfolio-based insurance wrapper actually looks like – both for a litigation funder and for a law firm? How do the structures differ, and what risks are typically covered?

The basic structure of a portfolio-based insurance wrapper is very straightforward.  Essentially, an insured purchases a policy with a specific amount of coverage limits that guarantees the insured will recover an amount equivalent to those coverage limits from the cases or litigation-related investments, loans, or other assets that comprise the portfolio that’s being insured.  If, at the end of the policy term – or if the policy doesn’t have a specific term, once the last of the covered cases or investments has ended – the insured’s recovery is less than the limits on the policy, the insurers will pay out a “loss” on the policy that effectively trues the insured up to policy limits.

Recovery against the policy limits is measured differently depending on who the insured is:  for litigants insuring pools of plaintiff-side litigation, insurers look to any amounts the litigant earns through damage awards and settlements on those cases; for litigation funders, hedge funds, or others insuring investments in litigation-related assets, insurers look to their returns on those investments; for lenders insuring loans to law firms or other participants in the plaintiff-side litigation ecosystem, insurers look to the amount of principal plus interest repaid on those loans; and for law firms insuring their work-in-process or “WIP”  on a group of cases, insurers look to the contingency fees that the law firm collects on those cases.

For a litigation funder, it’s as simple as identifying a set of investments, loans, or other assets to go into the portfolio, identifying the amount the funder has invested in whatever it is that collateralizes the portfolio, and then insuring a minimum recovery that is some significant percentage of the funder’s overall investment.  And as I mentioned earlier, these policies can insure an entire fund, a designated portion of a fund, a specific LP within a fund, or even a more bespoke portfolio comprised of select investments from within a given fund or from a cross-section of different funds.

As with portfolio policies for litigation funders, WIP policies can be placed on a programmatic basis across a firm’s entire contingency fee case book or on a more selective basis across certain specifically identified cases.  Here’s an example of how a WIP policy might work:  Imagine that a law firm was litigating ten cases on contingency, with an anticipated recovery of more than $100 million in contingency fees and expected WIP of $50 million across the portfolio of cases.  The firm could potentially purchase a WIP policy with a $40 million limit, equal to 80% of its expected WIP, which would provide coverage if, over what is typically a five- to seven-year policy term, the ten cases in the portfolio collectively earn the firm less than $40 million in total contingency fees.  If, at the end of the policy term, the firm had only recovered $20 million in total contingency fees, the policy would cover the $20 million shortfall against the $40 million in policy limits.

WIP policies are often used as a mechanism to attract litigation funding at a much lower cost of capital than otherwise would be available without insurance, including from sources of capital that don’t typically invest in litigation-related assets because of the high risk involved.  There are dozens of different capital sources beyond traditional litigation funders – including hedge funds, family offices, private equity firms, private credit lenders, and other alternative sources of capital – who are keenly interested in lending against WIP policies, as well as against other portfolio-based and single-case insurance policies.

WIP insurance can also be a very useful tool for lawyers within firms where the billable hour is king to get approval from executive or contingency fee committees, or from the broader partnership, to bring high-value contingency fee cases.  These policies provide the firm with a guaranteed minimum recovery from contingency fee litigation by the end of the policy’s term such that, if the cases don’t ultimately work out as planned, the financial result to the firm will be the same as if the lawyers on those cases had spent several years simply billing their time on non-contingency fee matters for clients who received a small discount on those lawyers’ hourly rates.

I should also note that, for any portfolio-based policy, as with some of the more traditional single-case policies like judgment preservation and adverse judgment insurance, premiums are generally in the form of one-time upfront payments.  But for portfolio policies more than single-case policies, there are also mechanisms like deferred and contingent or “D&C” premiums that insurers are increasingly willing to employ to bring down the upfront premium cost in exchange for a modest piece of the recovery waterfall if the cases or investments that comprise the insured portfolio are highly successful.

How are insurers underwriting these portfolio-based structures differently than single-case policies?  Are there specific underwriting thresholds, case mix requirements, or expected returns that make a portfolio “insurable”?

Most insurers define a “portfolio policy” as one that is insuring at least three to five cases, and the more the merrier.  These cases should be uncorrelated, such that they should not all rise and fall together, and the more diversity that can be introduced into the portfolio – with regard to identity of plaintiffs, identity of defendants, specific causes of action, subject matter of the litigation, etc. – the better, as well.

That being said, it is common for an insured portfolio to be comprised of cases from a single plaintiff or representing only a single subject matter area from a litigation funder, law firm, or group of lawyers within a law firm who specialize in that subject matter area – think patent infringement, antitrust, or mass tort litigation.  And of course, insurers are highly vigilant about adverse selection, and will not insure portfolios that they suspect to be comprised of a prospective insured’s cherrypicked worst or riskiest cases or investments.  The easiest way to mitigate this suspicion as a prospective insured is to insure a “complete set” – whether the entirety of a given fund from a litigation funder, a law firm’s entire contingency fee case book, a patentholder’s entire patent portfolio, or a litigant’s entire portfolio of plaintiff-side cases.

Underwriting one of these portfolios is a very different exercise than underwriting a JPI or AJI policy.  Rather than a single case with an extensive, well-developed record (including, as was often the case with JPI placements, the exact appellate record that would be put before an appellate court when they are asked to decide the case), insurers are often faced with a high number of cases and less detailed and voluminous information about each individual case.  Often, cases that are already underway will have a limited history of case filings and unfiled cases will have only a preliminary case description and damages evaluation.  Accordingly, while the number of cases increases substantially, having less information per case can result in the amount of underwriting time, and associated underwriting fees, being relatively similar to a JPI or AJI policy.

In terms of the actual underwriting process, it’s important to keep in mind that insurers do not need to put all their eggs in a single basket on portfolio polices like they do for a JPI or AJI policy.  Instead, they determine the likelihood of success for each case in the portfolio and then assign an expected return to that case.  Then, using a weighted average of all the cases, the insurer determines exactly how likely it is that the portfolio will collectively return an amount that exceeds the limits being purchased.  Insurers are also looking at other things, as well, like a law firm or litigation funder’s track record on similar cases or investments, the underwriting guidelines being used to select cases or investments, the bona fides of the key individuals involved, case budgets, and the judgment collection and enforcement risk presented by the relevant defendants.

It's also important to keep in mind that the structure of portfolio-based insurance policies makes it much less likely that a policy could suffer a full limit loss given the number of cases or investments that would need to go poorly in order for that to happen.  This is another key differentiator from JPI, where a single adverse appellate court decision or bad remand outcome can sometimes cause a full limit loss.

Lastly, as I noted earlier, insurers will often look to include a deferred and contingent or “D&C” premium in portfolio-based policies, which allow the insurer to participate in the upside of a portfolio of cases or litigation-related investments if the portfolio turns out to be highly successful.  Since a D&C premium only kicks in after the insured has recovered an amount in excess of coverage limits, underwriters of portfolio-based policies with a D&C component will also evaluate the probability that a portfolio brings in proceeds well in excess of limits, thus entitling them to that additional backend premium.

For litigation funders raising capital or structuring new vehicles, how critical is it to have an insurance solution baked in from day one? Are LPs demanding it, or is it still seen as an optional enhancement?

It ultimately depends on the type of investment capital that a funder is looking to attract.  Traditional litigation finance LPs, who seek to make high-risk, high-reward investments, often view insurance as antithetical to why they are investing in litigation finance in the first place, because the premium costs – whether upfront or D&C – cut into their returns.  These investors, and those funders who follow the same ethos, are generally not interested in wrapping their funds with any form of principal protection insurance coverage because they don’t want to forfeit any of their upside in order to do so.

On the other hand, a litigation funder who wraps a new fund with principal protection insurance can attract an entirely new class of investors that typically does not invest in litigation finance – investors who don’t need to understand litigation funding, or even litigation itself, in order to invest.  These LPs may invest in an insurance-wrapped fund precisely because their downside is de minimus or, depending on the limits of the relevant policy, essentially zero, but with a high potential upside – albeit, not as high as the upside would be without insurance.  This makes insurance-wrapped funds an ideal target for certain investment banking, pension fund, private equity, private credit, university endowment, sovereign wealth, family office, and other investors who will happily accept lower returns in exchange for lower – or, again, depending on the specific policy structure, potentially zero – risk.

So based on that, I see insurance coverage on a fund-wide basis as an optional enhancement that is very funder- and LP-dependent.  But it’s important to remember that we have a significant amount of flexibility in how we can structure these policies to best achieve our clients’ financial and risk management goals.  To give one example, there was a deal I worked on that involved a loan that a funder made to a law firm where the funds for the loan came from multiple different LPs, some of which needed principal protection coverage and some of which did not.  We were able to structure an insurance policy that only insured the portion of the loan attributable to the LPs who needed insurance coverage and effectively treated the portion of loan funds that came from the other LPs as co-insurance on the policy.  The significant co-insurance piece brought the cost of coverage down from where it would have been had we insured the entirety of the loan or a high percentage of the loan funds coming from all LPs.  So even in situations where there are distinct or even polar opposite LP needs on a single investment, loan, or other transaction, we can often create an insurance-based solution that works to deliver an optimal balance of risk and reward for everyone, enabling deals to get done that just would not have happened without insurance.

LFJ Conversation

An LFJ Conversation with Sam Ward, Director, Sentinel Legal

By John Freund |
Sam Ward is the Director of Sentinel Legal, the UK’s leading firm specialising in motor finance mis-selling claims, having successfully managed thousands of claims and recovered substantial compensation for consumers who have been mis-sold car finance nationwide.
Sam has taken an unorthodox and bold approach to transparency and marketing. Through engaging video content, insightful podcasts, and candid posts on platforms like LinkedIn, Sam and the entire Sentinel Legal team openly call out unfair practices and share their views and findings publicly, actively redefining what it means to be a consumer champion law firm.
A respected and trusted voice within the industry, Sam regularly provides expert commentary and insightful analysis across major TV Networks and News platforms.
Below is our LFJ Conversation with Sam Ward:
You've been closely involved in the motor finance claim issues in the UK, and attended last week's Supreme Court hearings. Can you describe the atmosphere? What stood out to you most about being there in person? There was clear apprehension at the start of Day 1. We arrived at the court around 9:15 am and faced a huge queue, filled with trolleys stacked with lever arch folders and boxes overflowing with documents for the hearings, it was quite a sight. It probably took us 30 minutes just to get inside. The security checks, complete with metal detectors and X-ray machines, set a very serious and somewhat ominous tone, highlighting the significance of the Supreme Court. Entering the courtroom itself, which was like stepping into an old classroom from Hogwarts, really amplified the gravity of the proceedings. What stood out most was the overwhelming presence of the banks' lawyers. Once seated, the consumer representatives, only about 10 out of the 60-70 people present, felt significantly outnumbered. It really was like a David and Goliath. How engaged did the Lords seem with the arguments being presented? Were there particular lines of questioning that surprised or impressed you? The Lords demonstrated extraordinary engagement. Their probing questions seemed driven by a genuine desire to thoroughly understand the complex issues leading up to the Supreme Court hearing. I was particularly impressed by their rigorous exploration of fiduciary duty and what constitutes genuine consumer consent. The questioning was relentless at times, with periodic interruptions from the Lords where exchanges could last 20 to 30 minutes before returning to the oral submissions. A memorable moment for me was Lord Briggs’ pointed comment to Mr Weir KC: "I don’t think you shrink from the implications that probably for the last 75 years, anything up to half the lenders have been acting dishonestly," with Mr Weir KC confidently responding, "My Lord, I do not shy away from that in the slightest." I couldn’t help but quietly fist pump from my uncomfortable wooden mahogany chair that I had now been sat in for 3 days. I understand the courtroom was packed with lenders and their solicitors, with relatively few consumer representatives present. Why the imbalance? And how did that impact your experience?  The imbalance was striking. The courtroom was predominantly occupied by car finance lenders and their legal teams, clearly illustrating the magnitude and resources invested by the car finance lenders. Consumers were nearly shoehorned into corners, highlighting just how crucial consumer advocacy is. The sheer number of bank representatives frantically typing away on laptops almost drowned out the Lords’ voices at times. For me it wasn’t a good look for the car finance lenders, they all seemed full of anxiety and under strict instructions on what to do and when to do it. The collective daily rate of these solicitors must have been staggering across all three days. Especially when they could have listened to it online….. What key takeaways should the legal funding and claimant communities understand about the hearing?  The core takeaway is the strong emphasis on transparency and fairness in financial transactions. The Lords well articulated questions to both appellant and respondent representatives highlighted their genuine want of understanding as to what has actually gone on here and how they might remedy it. If the Supreme Court upholds the Court of Appeal's unanimous October 2024 judgment, significant shifts in handling undisclosed commissions and conflicts of interest will follow, marking this case as one of the most influential consumer cases in British legal history. This could present substantial opportunities for litigation funders looking for an uncorrelated market to invest in and claimants seeking compensation for mis-sold financial products. How are you and others in the claimant community preparing for what comes next once the judgment is handed down? Sentinel Legal has been one of the leading firms in this space, handling thousands of motor finance claims and recovering over £500,000 in compensation for clients so far, all in the county courts, with no court of appeal or Supreme Court judgement to help us. Currently, we have around 700 claims stayed in UK courts, eagerly awaiting the Supreme Court's judgment to progress accordingly. Our systems are robust, tested through extensive litigation, and fully prepared to handle large scale claimant onboarding effectively. We continue actively onboarding new clients who feel they may have been mis-sold their car finance agreement. We are primed and ready to go should the Supreme Court uphold the Court of Appeals 2024 Judgement.  Sentinel Legal is the largest and most technologically advanced firm in the motor finance claims sector. We've achieved these results entirely in the county courts, without relying on precedent from the Court of Appeal or Supreme Court. Our custom built AI models and proprietary claims handling  systems have been built in house and rigorously battle tested through extensive litigation, positioning us uniquely to manage large scale claimant onboarding seamlessly and efficiently. Sam posts debrief videos of his days at court.  You can view the Day 1 video here.
LFJ Conversation

An LFJ Conversation with Louisa Klouda, Founder and CEO of Fenchurch Legal

By John Freund |

As the Founder and CEO of Fenchurch Legal, Louisa is responsible for overseeing all business operations, including fundraising, and ensuring the business’s overall success.

Louisa founded Fenchurch Legal in 2020 after an interest in the litigation finance market sparked an idea to apply a secured lending model to litigation finance. She discovered a market largely dominated by funders focusing on high-value, complex cases such as class actions, however, there was a lack of support for smaller claims. This insight led to the creation of Fenchurch Legal.

Before launching Fenchurch Legal, Louisa operated the broking and dealing desk for a corporate brokerage and finance firm in London. In this role, she gained extensive experience in mergers and acquisitions, corporate finance, and investment product structuring. Her role involved daily interactions with both retail and professional investors, as well as corporate clients.

Below is our LFJ Conversation with Louisa Klouda: How does Fenchurch Legal differentiate itself from traditional litigation funders? 

Fenchurch Legal operates differently from traditional litigation funders in several ways. Firstly, we focus on high-volume, low-value, process-driven consumer cases such as housing disrepair and financial mis-selling, where there is strong legal precedent supporting the claim type. Whereas larger litigation funders typically invest in high-stakes commercial disputes or class actions with multimillion-pound claims.

Secondly, the way we structure our lending is different. Traditional funders invest in cases on an outcome basis, taking equity-style positions – meaning they only receive a return if the case is successful, so they bear the risk of loss if the case is unsuccessful. In contrast, Fenchurch Legal operates as a direct lender, providing secured revolving credit facilities to law firms to draw down against costs and disbursements are repaid regardless of case outcomes. This structured lending model offers stability for both law firms and investors, ensuring predictable outcomes and controlled risk.

The key differentiation is that traditional funders invest in cases, whereas we provide loans.

Why doesn't Fenchurch have in-house lawyers, and how do you obtain legal expertise on the cases you originate? 

That’s a great question and one we often get asked. The answer is simple: Fenchurch Legal is a lending business, not a law firm.

Operating within the private debt sector, we provide business loans specifically for consumer legal case costs and disbursements with minimal litigation. Our expertise lies in secured lending, structuring loans and managing financial risk – not litigating cases.

We partner with law firms by providing them with the financial resources they need to run cases efficiently, while we focus on risk management, due diligence, and loan security.

Before entering a specific case type, we work with legal advisors to obtain counsel’s opinion and review case law and outcomes to assess viability and risk.

As part of our underwriting process, we outsource legal expertise where needed to assess a law firm's legal procedures, compliance with SRA regulations, as well as case viability. Additionally, we continuously audit and monitor the firms we fund, ensuring they meet strict legal and regulatory requirements, both internally by our team and by outsourcing to specialist legal professionals.

Unlike traditional litigation funders who take an active role in case strategy, our role is purely financial. We lend, monitor, and safeguard investor capital, ensuring that the law firms we fund have the financial resources and oversight needed to handle legal claims successfully.

Fenchurch focuses on small-ticket claims. What opportunities and challenges does a focus on that end of the market bring? 

One of the biggest opportunities the small-ticket claim market brings is the ability to fund cases with a clear legal precedent against highly liquid defendants, such as government bodies, banks, or insurers. This ensures that we have no risk of non-payment of damages and costs.

Another advantage is the scalability of our model. By funding high volumes of claims, we can diversify risk across multiple law firms and case types. To date, we have funded over 15,000 small consumer claims. Out of the 6,145 loans that have been repaid, 92% were successful. For the 8% that were unsuccessful, ATE insurance provided the necessary coverage, reinforcing our robust risk management framework.

One of the challenges of funding smaller cases is the operational complexity of managing a high volume of claims efficiently. However, we have developed strong due diligence, auditing, and monitoring systems that allow us to track performance and mitigate potential risks. We also have our own loan management software which provides a complete overview of our loan book and how our law firms are performing.

How does Fenchurch handle security and risk management concerns? 

At Fenchurch Legal, security and risk management are at the core of our lending model. As a direct lender, we structure loans to safeguard investor capital while ensuring law firms can operate effectively. Our key risk management strategies include:

  • Secured Lending Structure – Loans are backed by ATE Insurance, case proceeds, debentures and personal guarantees, ensuring capital protection.
  • Comprehensive Due Diligence – Before lending, we assess law firms’ track records, financial health, and case viability to ensure they meet our lending criteria.
  • Legal Precedent & Expert Review – We consult with barristers, law firms, and experts to evaluate claim types and expected outcomes.
  • Ongoing Monitoring & Auditing – We track performance, flag risks early, and ensure compliance with agreed terms.
  • Diversification – We fund a high volume of small, process-driven cases to spread risk across multiple firms and claims.

How do investors benefit from Fenchurch Legal's differentiated approach to the market? 

Investors choose Fenchurch Legal because they like our approach, which provides a predictable and secure investment opportunity. We operate as a direct lender offering structured loan facilities, meaning our investors benefit from a more stable, fixed-income-like investment model.

Our secured lending structure, combined with unique features such as risk management and diversification across a high volume of cases, provides investors with lower risk exposure and predictable returns.

As I often say, I come from a secured lending background, not a legal one. You wouldn’t ask us to stand up in court and argue a case, but you can trust us to look after investor money by structuring loans and managing risk effectively – that’s what we are good at.