Carolyn Elefant of Legal Blog Watch believes pre-paid legal services remain a good investment for consumers—and therefore a good deal for lawyers. For those not in the know, pre-paid legal services are kind of like insurance. Consumers pay a monthly fee in exchange for basic legal services. Major PPLS vendors include Hyatt Legal Plans, Inc., Pre-Paid Legal Services, Inc., and Arag Insurance Co., Inc.
PPLS lawyers do not have to do much. Most just send letters on the consumer’s behalf. If the consumer wants real representation, he or she must pay extra.
The consumer advocate in me thinks—based on what I have seen from PPLS in several cases—that PPLS is a rip-off. A few months of PPLS cost more than the hour or two it would take a lawyer to do what PPLS lawyers will do. And consumers who need real representation will not get it unless they pay more.
As a businessman, I do not know whether PPLS is a good deal. My hunch is that PPLS pays its lawyers peanuts, but it may be that the low demand on lawyers’ time balances that compensation. Based on an old article from the National Law Journal, lawyers also count on being able to convert PPLS clients to regular, higher-margin clients.
Pre-Paid Legal Remains a Good Investment | Legal Blog Watch