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Group Legal plans benefits for employer and employee
A properly developed group legal insurance plan can be the perfect complement to any employer’s work life initiative. Considering that many employees are nowadays increasingly swayed by benefit options when making career decisions, Legal insurance is a viable product for many employers.
However, there is no single fit-for-all group legal plan for all organizations. For a start, each organization has a distinct list of requirements when contracting for legal insurance. A requirement built on the premise of reduced administrative costs will require a different set of legal services than requirements built on enhancing a benefits package
or protect against liability. Legal plans also vary in what they offer: the quality of their customer service, flexibility of plan design and finally the experience and professional track record of their panel of attorneys.
In order to minimize the risk of poor service and plummeting employer satisfaction, an employer should conduct both requirements analysis amongst its employee base to cover for their difference needs, and a due research to select the most appropriate legal plan to fit those requirements based on experience, integrity and track record.
Group legal plans
Group legal plans in the workplace have experienced rapid growth recently because of their usefulness to both employer and employee alike.
For the employee, a group legal plan is a cheap way to get legal coverage in much the same way as other traditional benefits. For as little as $20 per month deducted from payroll, an employee is put in touch with an attorney who can draft his will, buy or refinance a home, adopt a child and plan an estate. Unlimited legal advice is offered at no cost to the employee.
The benefits for the employer include increased efficiency and productivity from their workforce, and reduced administration costs to handle personal matters. Another very attractive benefit is the very low cost involved in researching and implementing a group legal plan. In fact, such plans cost employers very little in terms of time and investment.
Group plans are structured on a voluntary basis, paid for through payroll deductions from the workforce. Additionally, the carrier handles all the claims, redundant paperwork and customer service related to the plan.
Differences between Pre-Paid and Legal Plans
It is not uncommon to see the terms “legal plans” and “pre-paid legal services” used interchangeably. While they share a lot of characteristics in common, there are a number of differences you should be aware of.
Both of these terms refer to an arrangement whereby you pay a fixed monthly or yearly fee in exchange for legal services. The idea behind them is to save consumers on high legal fees whilst offering a valuable service. That’s where the differences lie: what kind of service is offered and what is covered.
What are you entitled to in both schemes?
Pre-paid services cover for specific legal services: free phone consultation and advice, drafting of simple wills and trusts, review of sample contracts and writing of letters on your behalf. Legal services not provided will get charged at regular attorney fees, but you may be eligible for discounts.
Legal insurance, by contrast, works much like other insurance plans, like health or car insurance. Although specific legal services are offered at times, your insurance provider will typically offer a policy that covers for all legal services. The policy will pay on behalf of you, the policy holder, or reimburse all expenses, costs or fees that you pay for legal services up to the policy limit. For instance, your policy might reimburse
any fees incurred in your court judgments or pay your bail money – a service not provided by most pre-paid legal plans.
any fees incurred in your court judgments or pay your bail money – a service not provided by most pre-paid legal plans.
Comprehensive access plans
If you are a member of a pre-paid access plan and are not getting the legal services you think you need, then it is probably time to upgrade to a more comprehensive plan.
A comprehensive prepaid legal service plan is designed to cover for the majority of your legal service needs in a given year. Access services, such as legal advice and information by toll-free number and follow-up service, are provided at no cost to you. It’s in the realm of more complex legal matters that require more time and effort from your attorney, that the comprehensive plan is more beneficial than a basic, access plan. You can have your trust set up, instead of a simple will, and a more complicated
business sale contract drawn up as opposed to a simple contract. Legal representation can equally be provided in court for some cases, such as child custody.
Comprehensive prepaid plans are most suitable for people who need business advice, have family trusts or own real estates properties.
Pre-paid legal services for small business
If you are operating your own business, you cannot afford to go it alone when it comes to legal matters. The ever increasing complexities of law, spiralling costs of lawsuits and the proliferation of government red tape can land you in a lot of trouble.
The flip of the coin is hardly attractive either! Hiring a lawyer can constitute a substantial financial investment many cash-strapped small businesses and entrepreneurs cannot sustain. Lawyers charge a minimum of $200 per hour when it comes to “business law” and it can get very costly if you are involved in lengthy legal procedures, complicated
contracts or business transactions.
There may just be a glitter of hope in pre-paid legal plans. For a set monthly price, some legal providers are now bundling a whole suite of legal services especially tailored to the needs of small-businesses. Whether you need phone consultation on the legal complexities of a lease contract, or require legal representation during tax audits, a pre-paid plan can help you manage legal costs. An array of services is included as
“standard coverage” at no cost to you in the plan, and any legal matters not covered can be provided with a discount on fees.
Before you take the leap, you need to keep some caveats in mind.
You need to know more about the quality of service you are likely to get. While lower fees do not necessarily infer lower quality of work, it is always necessary to bear in mind that legal specialization plays a crucial part and lawyers are not interchangeable. Ask for references from previous clients or ask entrepreneurs who’ve used the services of the provider about the quality of work they have received from them. Use your state bar association, service organizations in your locale and your local Better Business Bureau to research law firms and the background of the attorneys in the network before selecting them. Things to look for are the number of years they have been operating, complaints from previous customers, the education background of attorneys, professional track record and so forth. With the increasing amount of small businesses involved in litigation and fee disputes with their legal providers, I iss important to give some thought to alternative courses of actions when dealing with disputes. Ask your prospective provider about the way in which they settle disputes or complaints. Do they have an in-house procedure to deal with complaints, appoint a senior attorney to deal with such things or do you simply have to
settle out of court ?
Benefits of Pre-paid legal plan for your company
Employers are on the hunt - researching benefit tools that are low-cost, easily administered and satisfy their employees’ needs. One such tool is pre-paid group insurance. We examine the benefits of having such a work-benefit option from an employer’s perspective.
The first benefit employers expect from legal insurance plans is increased productivity and efficiency. Today’s employees are interested in a variety of benefits to balance their work with their life requirements. Given that most American household had an issue with law last year that might have led them to hire a lawyer, it’s only normal that a legal benefit would increase employees’ morale and efficiency.
Having legal benefit as part of a work-benefit package can help the company recruit and retain the best employees. In this age of work-benefit hysteria, many prospective employment candidates base their career choices on the set of benefit package provided by employers.
Cost containment is another benefit. With less time and resources to be used for personal matters, the company expects to make significant savings on administrative costs.
Benefits of Pre-paid legal plans
Pre-paid legal services can be a very attractive alternative to hiring a lawyer for many people. You should consider the importance and relative priority of these benefits in light of your own legal needs. So what are the benefits going pre-paid compared to conventional hire of lawyers?
Benefit Number 1: Cost-Effective
Pre-paid legal plans can take the sting out of hiring a lawyer. Lawyers’ fees are prohibitive for most people: you can run bills of thousands of dollars and this is simply out of reach of most working and middle-class families.
With pre-paid plans, what you get charged is more in line with what you pay for your health or home insurance. Plans start as low as $9 per month
and typically don’t exceed the $30 mark.
Benefit Number 2: Simplicity
There is a number of very complicated set of fees lawyers charge: contingency fees, flat fees, statutory fees and hourly rates. In the case of contingency and statutory fees, you have to get into the intricate details of how these fees are computed – say for a contingency fee how much is the lawyer’s commission? – and their regulatory nature – who regulates the statutory fee and how do I know if these fees are in line with regulatory guidelines?-.
The other two types of fees can be equally as complex. Increasingly, attorneys choose to incorporate any overheads they incur, like secretarial expenses, parking charges and travel fees into their flat and hourly fees. They can also set a minimum number of billing units, like three tenths of an hour (18 minutes), irrespective of how long it takes them to deal with your problem.
This is just a sample rundown of what might influence the various fees charged by lawyers, other factors and arrangements can apply too. Contrast this with the simplicity in which pre-paid legal services are priced and furnished. The process is simple and straightforward: you sign an agreement to pay a fixed monthly fee and that’s about it. If what you’re looking for is not covered, your plan provider will give you a prior notice of a different billing so that you know exactly how much you will be charged.
Benefit Number 3: Pre-emptive Law
Pre-paid plans offer unlimited phone consultation and advice. This aspect of the service can save you a lot of trouble, money and time in the future. Most legal problems you are likely to face in your day-to-day life can be solved if you take the necessary steps in line with the law. With the right advice and consultation with your lawyer, you can detect legal blunders before they occur and hence minimize the risk of litigation and
protection.
Are Pre-paid services worth the money?
You may be covered when it comes to health, life, car or home insurance… but what about legal coverage?
The question is not if you'll need a lawyer, but when: according to the American Bar Association (ABA) “Americans have come to view legal assistance as a necessity”. Yet, most Americans have not used a lawyer more than once due to the sky high attorney fees – anywhere from $100 to $1000 per hour – and the trepidation involved in the search for legal services.
Prepaid legal insurance might just 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 defray the cost of legal services furnished 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.
Pre-paid 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, however, is that more than half of 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, so opt out. 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 discount on standard attorney fees instead. However, by virtue of 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 to a novice attorney. Because of cost considerations, many of the companies behind per-paid services assign trainee or inexperienced attorneys to handle phone consultation and drafting of simple legal documents. You are also less likely to build rapport and understanding, two of the most important attributes of choosing a good attorney, as over 90% of the work is done over the phone.
The question is not if you'll need a lawyer, but when: according to the American Bar Association (ABA) “Americans have come to view legal assistance as a necessity”. Yet, most Americans have not used a lawyer more than once due to the sky high attorney fees – anywhere from $100 to $1000 per hour – and the trepidation involved in the search for legal services.
Prepaid legal insurance might just 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 defray the cost of legal services furnished 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.
Pre-paid 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, however, is that more than half of 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, so opt out. 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 discount on standard attorney fees instead. However, by virtue of 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 to a novice attorney. Because of cost considerations, many of the companies behind per-paid services assign trainee or inexperienced attorneys to handle phone consultation and drafting of simple legal documents. You are also less likely to build rapport and understanding, two of the most important attributes of choosing a good attorney, as over 90% of the work is done over the phone.
