To identify the territory of regulation and tax of legal expenses risk, consider:
1. The location of the insured’s residence(s) or business establishment(s).
Legal expenses insurance can be taken out either by an individual or a corporate entity.
The risk location is the territory in which the insured is resident or its business establishment is located.
If the contract covers more than one individual insured or business establishment and these are situated, in more than one territory, each resident or establishment location will create a separate risk location.
Definition of 'business establishment'
European Union (EU) legislation defines the term ‘establishment’. Outside the EU the term is not so well defined, so in the absence of any contradictory guidance, it is appropriate to follow the EU approach.
Examples of business establishments:
- subsidiary companies
- branches of companies
- representative offices
- offices managed by businesses’ own staff
- tied selling agents
- factories and workshops
- mines and quarries
- oil and gas wells
- drilling platforms fixed to sea bed
Risk locator tool
Introduction to Risk LocationWhat is risk location and why is it important ?
Introduction to risk location
Establishing the risk location
To help establish risk location please consider the questions provided via the link below
Class of business guidance
To help you establish the risk location please consider the class of business
Risk Location Examples
The interaction of different territorial rules can make a given scenario complex. Applying the principles set out will assist market participants in establishing the risk location.
Lloyd's International Trading Advice (LITA)
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