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. 


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