My Employer Offers Legal Insurance - What Is That?

Employer-sponsored group legal insurance is a voluntary, employee-paid plan that provides legal coverage for most common personal legal needs.

Most plans cost less than $15 a month and some are even offered to retirees.

The way most plans work is when you encounter a personal legal need, like you want to engage in estate planning or you have a dispute with your neighbor, you call the insurance carrier and they provide you either with immediate assistance or they connect you with an attorney in their network.

If your issue is covered by the insurance plan, then the insurance carrier pays the attorney for their services. Your costs of the legal assistance will likely just be limited to any court filing fees and incidental costs.

Most plans cover:

· Will and trust preparation

· Domestic matters (divorce, child support, custody, visitation, alimony, adoption)

· Minor traffic offenses

· Bankruptcy proceedings

· Consumer protection

· Defense of criminal misdemeanors

· Debt collection

· Buying or selling a home

· Landlord/tenant issues

· Document review

If your employer offers this benefit, and either you know you’ll be needing legal services, or you like to be protected for the unexpected, this could be a cost-effective way for you to obtain them.

Considering a 2018 survey found lawyers charge an average of $368 per hour, it would take more than two years of plan payments to pay for that one hour of service out of your own pocket.

For example, you could pay $999 for a document preparer to transcribe your Chapter 7 Bankruptcy petition - that means no legal advice can be given to you and you have to not only file the petition with the court yourself, but you have to represent yourself at all creditor and adversarial hearings related to your case - or you could pay for more than 5 years of coverage with the group legal insurance plan that would provide you not only with the Bankruptcy petition preparation, legal advice, filing services and representation in court, but a host of other legal services should you need them like preparing your will, fighting your traffic ticket, reviewing your new lease, dealing with your home contractor, and a host of other legal services.

Now that you know of the financial benefits of a legal insurance plan, you may be wondering how much information is shared with your employer who sponsors the plan. The good news is your plan attorney has no contract with your employer and no duty to apprise them of your use of the plan.

So, if you're thinking about buying that vacation home in Big Bear, rest assured your boss won't find out about it because you sought real estate advice through the group legal plan.