Pre-paid plans make legal cost affordable

•Hiring an attorney isn't cheap. But many people have found a manageable way to handle legal costs: They use pre-paid plans. Much like insurance policies that cover legal services, doctor's visits or car-accident expenses, these plans have grown in popularity over the years. Consumers pay a predetermined amount each month and in return gain access to a variety of legal services. Some services are covered completely under the plan, and those that aren't generally come at a discount. "We've seen just a huge increase in the number of people who are actually using it to get legal consultations of a wide variety," said Orlando attorney Dan Mantzaris, who practices at deBeaubien, Knight, Simmons, Mantzaris & Neal. About 40 percent of the firm's work is on behalf of clients using prepaid legal services, he said. The firm works through Pre-Paid Legal Services Inc., a publicly-traded company based in Oklahoma that's one of the country's larger providers. Other providers include ARAG, Countrywide Pre-paid Legal Services and Hyatt Legal Plans.
•The problems: Pre-Paid Legal Services Inc. recently identified the top services for which people use its attorneys:
•Real estate: Help with transactions, landlord and tenant issues, foreclosures and short sales.
•Consumer finance: Retail transactions for warranties, guarantees and other contracts.
•Family Law: Divorce, child support, child custody and child visitation.
•Debt collections.
•And estate planning.
•According to a survey conducted for the American Bar Association, more than 70 percent of respondents said they could have used a lawyer over the past year. "Most people don't realize there are a lot of aspects of their everyday lives that have legal aspects to them," Mantzaris said. "If we can get people to contact us before they get to be big problems, we can provide them a lot better service." For example, a dispute with a car mechanic over a payment. Or a review of cell-phone contracts. Right now, many consumers seem to be having problems with companies not honoring warranties, said Leslie Fisher, Pre-Paid's vice president of attorney resources. Up to 85 percent of problems brought to lawyers through pre-paid plans can be resolved easily, according to the American Prepaid Legal Services Institute, a Chicago-based nonprofit group that provides information to the prepaid legal services industry. The organization estimates that about 32,000 attorneys participate in group and prepaid legal services. Thousands of companies offer such plans to their employees, according to the institute.
•The plans: Such legal-service plans are often offered through employers but can also be purchased individually. The plans can cost between $70 and $400 annually, according to the American Prepaid Legal Services Institute. In Florida, Pre-Paid Legal Service's family plans cost from $16 to $25 per month according to its Web site. A basic family plan includes telephone consultations, phone calls and letters on behalf of a client review of personal legal documents up to 10 pages each, will preparation, and help with traffic tickets. They also can provide a defense if you are charged with a death in a traffic accident. In addition, the plan can provide help with audits and assistance with civil lawsuits and criminal charges that are employment related. The plan also offers discounts for other services. The company has some exclusions. For example, it won't defend clients charged with driving under the influence of alcohol or drugs, or illegally leaving any accident scene. Some are skeptical of the need for prepaid legal services, and not everyone has been happy with their experiences. Some have reported that they ended up paying more for legal services than they expected; others have reported problems trying to cancel the service or get refunds. People purchasing such plans should shop carefully and understand exactly what they're purchasing, advised Tori Jo Wible, executive director of the American Prepaid Legal Services Institute. "They ought to look at the kinds of legal issues they believe they may have and whether they're going to be covered under the plan," she said. Criminal activity, for example, is often not covered under the plans, she said. "It's mostly intended for the everyday legal stuff that we all encounter and [that] most of us just ignore until it's too big to ignore."