Are Prepaid Legal Services Worth It?

Perhaps you have health, life, car and house insurance, but what about legal coverage? Is it really necessary to add that too?

The question is not if you'll need a lawyer, but when: according to the American Bar Association “Americans have come to view legal assistance as a necessity”. Yet, most Americans have not used a lawyer more than once due to high attorney fees and the inconvenience involved in the search for legal services.

Prepaid legal insurance could be the answer you have been looking for. The concept is simple, for a fixed monthly subscription, you get telephone access to advice from a lawyer. You pay a fixed amount in advance each month to cover the cost of legal services in the future. These services span various areas of the law, anywhere from reviews of simple legal documents and the writing of a simple will to more comprehensive coverage of trials, divorce, bankruptcy and real estate issues.

Prepaid legal coverage is a very attractive proposition for people who don’t have the resources to retain a lawyer on a regular basis whenever they need assistance. You effectively have a network of attorneys you can use as retainer to seek preliminary advice about what the issues are and how the procedures work whenever legal matters arise. Services not covered by the plan are available to members for a discount on regular hourly rates or flat fees.

A hard fact is that many new subscribers drop out of a prepaid plan after their first year. One reason could be that many members do not require any legal assistance during their first year. Another reason is the scope of services offered, which are very basic and limited in nature. Most plans have certain caps or maximums as far as benefits provided are concerned, and purport to offer discounts on standard attorney fees instead. However, by simply calling around by yourself you could probably negotiate a lower rate.

Another problem with pre-paid legal plans is the likelihood of getting assigned a novice attorney. Because of the cost, many companies behind per-paid services assign trainees or inexperienced attorneys to handle phone consultation and drafting of legal documents. You are also much less likely to build rapport and understanding, two of the most important attributes of choosing a good attorney, because over 90% of the work is done over the phone.