Legal Matters: How Legal Insurance Can Change Everything for Employers and Their Employees

By BeneRe
February 13, 2024

When you think of supplemental insurance, some of the coverages that come to mind may include accidentcritical illness, and hospital indemnity. But with over two thirds of Americans facing at least one legal issue each year, many employees are interested in obtaining legal insurance as a supplemental benefit that provides financial protection. 

To answer this call, employers are expanding their supplemental benefits offering to include legal insurance for their employees. Here is how legal insurance works and why nearly half of all U.S. employers are including it in their supplemental coverage plans to continue to attract and retain the best talent. 

How a group captive model can maximize help for employee legal issues

In some ways, legal insurance is similar to health insurance models. The concept is to make legal coverage and services more accessible to employees and affordable for employers to offer. Many companies are discovering that a supplemental benefits group captive model can serve as the catalyst for an affordable and effective supplemental benefits program, including legal insurance. 

In this model, the group captive insurer is dedicated to creating a pool of coverages, such as Accident, Critical Illness and Hospital Indemnity, which are non-catastrophic risks with a short duration of development. Employees enroll in fully-insured policies that are then reinsured by the captive. All employers in the group are pooled together to create financial stability and predictable performance. Now legal coverage can be considered as part of the captive equation, as well. 

Offering financial protection from legal expenses for family, finances, and the future

Legal insurance can be used to help employees protect and plan for what’s important to them both now and in the future, and can also be used for unexpected situations. Here are a few applications for legal coverage:

Family Law Matters: Legal insurance can assist individuals with family law matters such as divorce, child custody disputes, adoption, or drafting prenuptial agreements, providing access to experienced attorneys for guidance and representation.

Estate Planning: Legal insurance can cover the costs associated with estate planning, including drafting wills, creating trusts, and establishing power of attorney or healthcare directives, ensuring individuals have the necessary legal documents in place for their assets and healthcare decisions.

Criminal Defense: In the unfortunate event of criminal charges, legal insurance can help cover the expenses of hiring a defense attorney to represent individuals and protect their rights throughout the legal process.

Consumer Protection: Legal insurance can be utilized for issues related to consumer protection, such as product liability claims, fraudulent business practices, or disputes with creditors, enabling individuals to seek legal advice and take appropriate action.

Traffic Violations: Legal insurance can assist individuals in dealing with traffic violations, such as speeding tickets or DUI charges, by providing access to attorneys who can help navigate the legal system and minimize the impact on their driving records and insurance premiums.

Things to look for in a quality legal insurance carrier

When choosing a legal carrier to partner with for a supplemental benefit offering. Employers should look for the following:

  • Attention to detail – Make sure employees have access to legal professionals who read and understand the “fine print” of legal documents and follow through on every detail
  • Attorney selection assistance – Employees need clear guidance on choosing the attorney or legal professional that is the best fit for handling their legal situation
  • Proven value – Inevitably legal situations will arise for employees; invest in access to a network of legal professionals that bring financial protection and mental wellbeing to employees

Making legal assistance accessible to every employee

Based on the structure of a typical employer-offered legal insurance plancomprehensive legal coverage costs an employee an average of $18-20 a month. When you consider that current U.S. attorney fees currently average over $300 an hour, employee access to affordable legal consultations is a highly attractive benefit. Also, some employers may offer an employer-funded version of legal insurance making this option even more valuable to employees. 

Introducing BeneRe Legal, a new group captive solution

BeneRe has partnered with ARAG, the leading legal insurance carrier, to now offer BeneRe Legal. It’s a supplemental benefits group captive program based on our commitment to better benefits and total transparency, and offering employers a healthier approach to financially protecting employees. 

This type of program offers:

  • Legal services to protect employees from unexpected legal expenses
  • Financial transparency regarding claims and expenses for employers
  • Potential year-end dividends, after a three-year dividend pool maturation period, that can be reinvested in additional employee benefit programs or used to offset the cost of coverage

If you are an employer looking for more ways to recruit and retain the best talent, offering your employees legal insurance as part of your voluntary benefits program may be an attractive option. When you’re ready to make a change to increase the value of the supplemental benefits you offer employees, ask your broker or contact the team at BeneRe for more information.