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Invoicing Matters Covered by a Legal Expences Insurance

The recommended way to invoice matters covered by a legal expenses insurance is to first create an invoice for the insurance company. Once their payment has been received, the remaining part of the invoice is sent to the principal to be paid. In theory, the invoices to the insurance company and to the principal could be created simultaneously. However, to avoid extra work, we do not recommend it as the payment of the insurance company may not be as expected, leading to an additional invoice to the principal.
 

Recommended Approach: Invoice the Insurance Company First, Then the Client

The recommended way to invoice a legal expenses insurance matter is to first create an invoice payable by the insurance company. After the insurance company’s payment has been received, an invoice for the remaining amount can be sent to the client.

Invoice the insurance company as follows:

  1. Check the validity of the information added to the matter.
    • All the required insurance information must be added to the matter principal.
    • The insurance company must not be added to matter parties as a payer.
  2. Create an invoice of the matter.
  3. Ensure that the invoice is as desired by previewing it with the invoice template for insurance companies. Select Print for Insurance Company > Preview
  4. When printing the invoice, select the Print for Insurance Company option.
    • The option is enabled only when insurance information has been added to the matter party.
  5. The software checks if you also wish to create an invoice for the deductible to the principal in case you have selected in the principal’s insurance information the Create Invoice for Deductible field, or it has been defined in the business unit parameters.
    • If you choose to create the invoice for deductible, that invoice can be found in the Advance Invoices folder of the matter.
  6. Define the invoice content and layout in the Invoice Printing Parameters window.
  7. The software creates the invoice.
    • The front page of the invoice covers the insurance company’s name and address details, number of the legal expenses insurance, subject, potential description and invoicing contact.
    • In the actual invoice, the matter principal is marked as the payer, and the invoice amount is the total invoice amount of the matter. The insurance company will calculate their share to be paid from the total.
    • The power user can define the front page’s title and descriptions in the settings. The fields can also be saved empty by adding a blank space to them.
  8. Send the invoice to the insurance company.
    • It can be sent by email by selecting Print for Insurance Company > Send via Email.
    • In that case the recipient’s email address is 1) insurance company’s invoicing email address, 2) invoicing email address of the insurance company’s invoicing contact, 3) email address of the insurance company’s invoicing contact, 4) email address of the insurance company.
    • The address added to the CC field of the email message is 1) invoicing email address of the party, 2) invoicing email address of the payer, 3) invoicing email address of the payer’s contact person, 4) email address of the payer’s contact 5) email address of the payer.
  9. When the payment from the insurance company has been received, adjust it to the invoice.
    • NOTE! If the adjustment is done manually, change the insurance company as the payer to have the payment correctly adjusted to the net and the VAT.
    • If you have printed the invoice using the Print for Insurance Company function and payments are imported to the system as reference data, the insurance company is automatically recognized as a payer based on the invoice reference.

Once the insurance company payment has been adjusted to the invoice, invoice the principal:

  1. Print the same invoice for the principal by selecting Print Invoice on the ribbon.
    • You can select the invoice to be printed to the printer or as an email attachment. 
    • If your company uses Maventa e-invoicing, the ribbon also offers the Send Electronic Invoice button.
  2. The invoice is printed without the cover letter.
    • The open invoice amount takes into account the insurance company payment which is also displayed in the invoice.
    • If the principal is a taxable company, the invoice contains all the VAT of the original invoice.
  3. Send the invoice to the principal.
     

Invoicing the Insurance Company and the Client Simultaneously

In some cases, the client’s deductible is invoiced at the same time as the insurance company. However, this invoicing method may cause issues if the insurance company's reimbursement differs from the expected amount.

If invoices to both the insurance company and the client are to be created simultaneously, follow this process:

  1. Create an invoice for the matter as usual. 
  2. When printing the invoice, select Insurance Company > choose the way you want to send or print the invoice.
    • From this menu, you can also preview the invoice using the insurance company invoice template.
  3. Answer Yes when the software asks whether an invoice for the deductible amount should also be created. 
  4. In the Invoice Printing Parameters window, define the information to be displayed on the invoice. 
  5. The software creates a full invoice addressed to the client for the insurance company.
    • The invoice cover page is printed with the insurance company's information.
    • The insurance company calculates the reimbursable amount based on the invoice addressed to the client.
    • The insurance company's payment is allocated to the full invoice.
  6. At the same time, the software creates a deductible invoice for the client according to the legal expenses insurance information.
    • For private clients, both the insurance company's share and the deductible amount are calculated from the gross invoice amount.
    • For corporate clients, the deductible is calculated from the net invoice amount. In most cases, the insurance company reimburses part of the net amount, while the client remains responsible for the deductible and the full amount of VAT.
  7. The software prints both invoices and saves them as PDF files on the invoice's Notes tab.
    • The deductible invoice is shown in the Advance Invoices folder under the client and matter information, as well as in the Financial Administration area.
  8. A link to the deductible invoice is available in the Deductible Invoice field on the Additional Information tab of the insurance company invoice.
  9. Send the invoices to the insurance company and the client. Allocate the payment received from the insurance company to the invoice.
    • If allocating the payment manually, change the payer to the insurance company so that the payment is allocated correctly between net amount and VAT.
    • If reference payments are imported into the software, the insurance company is automatically identified as the payer based on the reference number, provided that the To Insurance Company option was selected when printing the invoice.
  10. Allocate the payment received from the client to the deductible invoice, for example through the Advance Invoices folder in Financial Administration.
    • The deductible invoice functions like an advance invoice. Therefore, payments allocated to it are automatically transferred to the invoice sent to the insurance company. Once a payment is recorded for the deductible invoice, its status changes to Used.
  11. If the remaining balance on the invoice is 0.00 after the insurance company and client payments have been allocated, the invoice status changes to Paid. 
    • If a balance still remains after the payments have been allocated, the remaining amount can be printed and sent again to the client for payment.
    • The invoice will show payments received from both the client and the insurance company.
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