Abbey Legal Protection has won a deal that could be worth millions administering commercial legal expenses policies for giant insurer Axa.

Insurance Times was informed in September that the insurer was seeking to enter the legal expenses market but Axa denied this.

Neither Axa nor Abbey Legal currently knows exactly how much this new deal will be worth.

Axa says expects around £250,000 worth of premium income from the schemes business Guardian possessed. There are also something like 300,000 stand-alone policies which could generate huge volumes of business.

However, Axa has still to decide which of these policies will include compulsory and which will include optional legal expenses cover. One of the areas where the two see room for synergy is in the construction industry where both firms are major commercial insurance providers.

Previously, Axa had underwritten legal expenses cover itself, but with legal expenses becoming a more significant element in commercial insurance, it has decided to hand the task to Abbey.

Stephen Cheshire who is casualty manager for Axa Insurance said: "We decided on Abbey because the company is flexible enough to handle both scheme and stand-alone business. They also offer excellent quality of support services in both claims management and advice."

Leo Gibbons, business development manager at Abbey Legal, added: "The legal environment has changed enormously recently and there is more reliance on legal advice. Axa has been quick to realise the importance of legislation that will affect the small-to-mediums marketplace."

Abbey Legal started administering four of Axa's products on October 1.