Photo/Illutration The website of Japan Legal Network introduces ATE and Atera services. (Captured from the website)

A Tokyo-based startup is offering insurance that covers the legal expenses of plaintiffs if they lose their lawsuits in court.

Japan Legal Network Co. started providing two types of services similar to after-the-event legal protection insurance on Dec. 19: ATE for small companies and Atera for individuals.

The company said the service is the first of its kind in Japan.

The policies differ from existing before-the-event legal expense insurance because people can sign up after the occurrence of a problem that leads to litigation. In addition, Japan Legal Network clients do not have to shoulder the financial burden, such as lawyer fees, if their lawsuits fail.

The company’s insurance is mainly intended for compensation claims for unpaid overwork, traffic accidents and uncollected credit obligations.

However, Japan Legal Network screens all potential cases and accepts only the ones it deems have a solid chance of winning in court.

“This is a service that eliminates the risk of people having to pay lawyer fees after they lose their lawsuits,” said Yasufumi Minamitani, the CEO of Japan Legal Network and a member of the Daini Tokyo Bar Association. “It will make it easier for them to resolve their problems because they do not have to give up filing lawsuits.”

The company guarantees payment of a certain amount if the client loses the lawsuit. The amount of “guarantee money” is set to cover the fees for the client's lawyer and the service fee for the company.

The company pays the lawyer's fee on behalf of the client.

If the plaintiff wins compensation exceeding the amount of guarantee money, the client pays Japan Legal Network a sum equivalent to the guarantee money.

But if the compensation amount is smaller than the guarantee money, they do not need to pay the shortfall.

According to Japan Legal Network, Britain, Canada and other countries already have forms of ATE Insurance.

For more information, visit the Japan Legal Network website at: (https://legalnetwork.jp/)