No win no fee explained: how Conditional Fee Agreements work
Last updated · By Mustafa Bilgic
What "no win no fee" actually means
A no win no fee arrangement lets you bring a personal injury claim without paying your solicitor's fees up front and without the fear of a large legal bill if the claim fails. In legal terms it is a Conditional Fee Agreement (CFA): the solicitor's right to charge their professional fees is conditional on the claim succeeding. It is the most common way accident and injury claims are funded in England and Wales, and it is the model behind almost every "we'll only charge you if you win" advert you see.
The idea is risk-sharing. Your solicitor only earns their fee if they win compensation for you, so they take on part of the financial risk of the case. In return, when you do win, they are entitled to charge an extra amount — the success fee — for having taken that risk. Solicitors offering CFAs are regulated by the Solicitors Regulation Authority (SRA), which sets the professional standards they must meet, including being clear with you about costs.
If you win vs if you lose
The simplest way to understand a CFA is to look at the two possible outcomes side by side. The table below is a general guide to who pays what; the precise wording of your own agreement always governs.
| Cost | If you WIN | If you LOSE |
|---|---|---|
| Solicitor's basic fees | Usually recovered from the other side | Normally nothing to pay |
| Success fee | Up to 25% of general damages + past losses, deducted from your compensation | Nothing — no success fee if you lose |
| Other side's legal costs | Not your concern (they pay their own) | Usually covered by ATE insurance |
| Disbursements (reports, court fees) | Usually recovered or deducted as agreed | Usually covered by ATE; sometimes by you |
| ATE insurance premium | Often payable from your damages (or self-insured) | Usually not payable if it is a "no win" policy |
The success fee and the 25% cap
The success fee is the part that often surprises people, so it is worth being precise. It is an uplift on your solicitor's basic fees that becomes payable only if you win — it is the price of them taking the risk of the case. Before 2013 the success fee was recovered from the losing party; the Legal Aid, Sentencing and Punishment of Offenders Act 2012 (LASPO), in force from April 2013, changed that so the success fee in personal injury cases is now paid by the claimant out of their damages, but it is capped.
For personal injury claims the success fee cannot exceed 25% of two categories of your damages:
- General damages — your award for pain, suffering and loss of amenity (the injury itself); and
- Past financial losses — losses you have already suffered, such as lost earnings up to settlement.
Crucially, the success fee cannot be taken from damages awarded for future loss, such as future care, future treatment or future loss of earnings. That protects the money you may need for the rest of your life. The 25% figure is a maximum, not a fixed rate — a firm may charge less, and many cap their total deduction even lower for straightforward claims.
After-The-Event (ATE) insurance
After-The-Event insurance is a policy taken out after the accident, specifically for the claim. It exists to cover the two things that could otherwise leave a losing claimant out of pocket: the other side's legal costs and your own disbursements if the case fails. With ATE in place, a genuinely meritorious claim becomes low risk for you — which is what makes no win no fee work in practice.
The ATE premium is normally only payable if you win, and is often deducted from your compensation at the end; in some cases part of it is deferred or self-insured by the firm. Because qualified one-way costs shifting (QOCS) already protects most injured claimants from paying the defendant's costs when they lose, ATE today mainly backstops disbursements and the gaps QOCS does not cover. Ask your solicitor whether ATE is arranged, what it covers, and how its premium is paid.
So are there any hidden costs?
"No win no fee" is not quite the same as "no cost ever". The phrase covers your solicitor's professional fees, but disbursements are separate, real expenses incurred to run your case:
- medical report fees and expert evidence;
- court issue and hearing fees;
- barrister's (counsel's) fees, if needed;
- searches, records and travel costs.
In a typical claim these are funded by the solicitor as the case runs and then recovered at the end, or covered by ATE if you lose — but the agreement should spell out who pays them in each scenario. None of this is genuinely "hidden": a regulated firm must explain your potential liabilities clearly, and you are entitled to a written breakdown. The practical advice is simple — read the CFA before signing and ask, in writing, exactly what would be deducted from your compensation if you win and exactly what you would owe if you lose.
How the US "contingency fee" differs
If you have seen American legal dramas you will know the phrase "contingency fee". It is the US cousin of no win no fee: the attorney is paid only if you recover money, taking an agreed percentage of the settlement or award. The headline differences are that US contingency fees are commonly around 33% (often a third, sometimes higher if the case goes to trial), and they vary by state — some states cap fees in certain claim types, others do not. Court costs and litigation expenses are handled separately and the rules differ from the English CFA model, so the UK figures and the 25% cap on this page do not apply to US claims. Always check the written fee agreement for your own state.
Frequently asked questions
What does no win no fee mean?
No win no fee is the everyday name for a Conditional Fee Agreement (CFA), the most common way personal injury claims are funded in England and Wales. Your solicitor only charges their professional fees if your claim succeeds; if you lose, you normally do not pay those fees, provided you kept to the agreement and acted honestly. It shares the risk so you do not pay legal fees up front.
Do I really pay nothing if I lose?
If you lose you usually do not pay your own solicitor's professional fees, but that is not always the same as paying nothing. You may still owe disbursements (such as medical report or court fees) and, in some cases, the other side's costs. This is why claims are normally backed by ATE insurance designed to cover those liabilities. Always confirm what you would owe if you lose before signing.
What is the success fee and is it capped at 25%?
The success fee is the extra amount your solicitor charges for taking the risk, payable only if you win. Since the LASPO reforms (in force April 2013) it is capped at 25% of your general damages and past losses in a personal injury claim, and it cannot be taken from damages for future care or future loss. The 25% is a maximum and the fee is deducted from your compensation, not added on top. See general vs special damages.
What is ATE insurance?
After-The-Event (ATE) insurance is a policy taken out after an accident to protect you against paying the other side's legal costs and your own disbursements if the claim fails. It is what makes no win no fee genuinely low risk. The premium is usually only payable if you win, and is often deducted from your damages or partly self-insured. Ask whether ATE cover is in place and how the premium is paid.
Are there any hidden costs or disbursements?
A CFA covers your solicitor's professional fees, but disbursements — medical reports, expert evidence, court fees and barrister's fees — are separate. They may be funded by your solicitor and recovered at the end, covered by ATE if you lose, or in rare cases payable by you. None of this is hidden if you ask: a regulated firm must explain clearly what you may pay. Read the agreement and request a written breakdown of every deduction.
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