The Legal Protection Group is now the only insurer that will sell policies on an individual basis.
A spokeswoman for LPG said it was committed to the so- called stand-alone personal policy market, but the company might be 'changing the package' in the new year.
Premiums may also be increased from the current pounds 150 annual level (for pounds 25,000 cover) and the higher pounds 180 annual level (for pounds 50,000).
Other players in the market believe that LPG might be forced out of this particularly difficult sector. The four other main suppliers of legal expenses insurance have all now departed.
CareAssist attributes its own withdrawal to 'selection problems': it has had a high claims rate because many of its policyholders took out the cover in anticipation of legal trouble.
A spokesman said it was 'highly improbable' that it would ever go back into this market.
LPG currently provides cover to about 17,500 individuals through stand-alone policies. But it reaches another 5 million people through its employer and trade association group schemes.