Life can put you into circumstances where you would need legal guidance. Although specifics on legal matters are everywhere on the internet, the technicalities can be tricky to understand or deal with. Thus, many suggest opting for prepaid services for legitimate counsel.
To understand the topic better, our legal team will discuss whether or not prepaid legal services are worth it.
Defining Prepaid Legal Services
Prepaid legal services are exactly how you read it—legal services paid for before you actually receive the service.
You avail of a plan with a collection of services that fit your needs by paying an annual fee. You can think of it as rent or insurance. You pay for it in case you need it in the near future. The idea is to save money by availing of legal services in bulk or as a ‘pay now, fly later’ scheme.
So is a prepaid legal service worth it? Let’s find out!
Advantages
Security for Potential Legal Needs
Just like an insurance policy, prepaid legal services including LegalZoom or LegalShield give you a sense of security for a period of time. Prepaid legal services are for you if you anticipate that you’ll need regular legal consultation for the foreseeable future.
You’re assured of sound legal advice for the duration of the service, freeing your mind to actually do your business.
Immediate Legal Advice
Prepaid legal services can include phone, chat, or email consultations with lawyers to provide you with quick and sound legal advice. This is definitely much better than searching for answers to your legal woes on the internet.
Experienced Lawyers on Call
Most prepaid legal services including Rocket Lawyer and LegalShield employ a network of lawyers with different specializations who can answer a variety of legal concerns for their clients. As a network, lawyers on-call can refer you to a colleague that can handle more specific or complex cases.
Convenience
Overall, prepaid legal services should ease your mind by letting you get ahead on imminent legal issues. Prepaid legal services may also be utilized to handle repetitive legal tasks such as review of contracts and documents for a company.
Disadvantages
Other Types of Services Not Covered
Most low-cost prepaid legal services only cover uncomplicated services such as preparation and review of basic legal documents like contracts and deeds. Complex cases like divorce, bankruptcy, and criminal defense are usually out.
Some plans may provide increased coverage of legal issues, but this might get really expensive.
Unused Legal Services
Prepaid legal service plans usually cost around $250-300 annually. Compared to hiring a lawyer to review a contract, a prepaid legal plan is a lot cheaper and can serve as a cushion for hefty legal fees. However, if you are unable to use the services for a certain amount of time, you might waste hundreds of dollars every year.
Is Prepaid Legal Service Right For You?
Will prepaid legal services be worth it in the long run? It depends on how often you can utilize the service. Like buying a product in bulk, it will be wasted if you can’t consume it.
For example, your employer may offer prepaid legal service at $25 a month, deducted from your pay. This is already $300 a year, which will compound year after year. You might actually avail more medical services in a year than legal services.
If you’re not likely to draft contracts monthly, you can consider skipping on a plan. And, of course, divorce, criminal cases, and writing of wills are not a yearly occurrence, on average.
On the other hand, having a prepaid legal service for small to medium-sized businesses may be beneficial. The company may fully utilize what they pay for the prepaid legal service when they review contracts regularly or have debts to collect.
Bigger businesses that are regularly facing lawsuits and patent disputes [1] may avail of higher-priced plans. Having someone to consult about legal matters whenever you need it is a great perk as well.
Conclusion
Prepaid legal services are great for SMEs and institutions who regularly avail of simple legal services. Compared to having a lawyer on retainer, availing a plan can be cheaper. For individuals, prepaid legal services may not be for them.
Given the frequency of legal tasks, or life events that require legal advice, one might be better off going old school and consulting a lawyer rather than splurging on the service.
