Prepaid legal plans provide reduced-rate legal services for a monthly fee, with coverage varying by plan. Plans may offer discounts, consultations, and additional services such as credit monitoring or identity theft protection. Some plans offer self-service legal assistance and access to a network of attorneys.
Prepaid legal plans offer policyholders access to legal services at greatly reduced rates in exchange for paying a monthly premium. The coverage offered by prepaid statutory plans varies depending on the company providing the service and the extent of coverage chosen by the policyholder. Some plans cover basic legal services, such as uncontested divorce, bankruptcy, and adoption, while others offer coverage primarily for extended litigation. Most plans also offer significant discounts on all different types of legal services and limited free consultations with attorneys. In some cases, plans might also offer additional services, such as credit monitoring or identity theft protection.
Also known as legal insurance, prepaid legal plans require policyholders to pay a monthly fee with the promise that the plan can help cover legal issues as they arise. The amount of coverage offered can vary significantly by plan. For example, some plans focus on the issue of legal liability. If a contractor is sued, the plan helps defray the cost of legal representation. Other plans address more mundane legal issues. For example, the plan might provide comprehensive coverage for simple, uncontested, day-to-day legal issues that people often face, such as divorce or mortgage settlements. In such cases, the policyholder may be responsible for paying court costs, but the plan will cover the attorney’s time and effort to complete necessary legal services.
Typically, prepaid legal plans also offer policyholders the opportunity to obtain legal services not covered by the plan at a significant discount through the plan’s network of attorneys. In addition, plan participants often have access to a legal referral and advice system that allows policyholders to call a toll-free number to be directed to an attorney who can answer basic questions about their case. The plan could also cover a simple action by the attorney, such as writing a letter or making a single phone call on behalf of the policyholder.
Some types of prepaid legal plans offer policyholders self-service legal assistance in the form of downloadable and customizable legal forms available through the plan’s website. In addition to these do-it-yourself options, some plans now help policyholders monitor their credit or protect their identity through identity theft schemes. These services alert policyholders when plan monitoring services detect anomalous financial activity and offer personalized assistance to those who have been victims of credit card or identity theft, acting as an intermediary between the policyholder and the credit bureaus .
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