Prepaid Legal Scam

You've probably heard plastered all over the news about prepaid legal scams. The idea of prepaid legal was originally a program where people pay a small premium each month to "prepay" for any legal expenses they may come across. Functioning under the same idea medical insurance, what may have only cost a extraordinary amount legal wise (a DUI legal defense) could be made much less through a prepaid legal plan. While this can sound like a really good idea, in reality, could be a waste of money or some would say it, "a scam".

Prepaid legal services first began in the 1930s in Europe. As the concept became more and more popular and was eventually shipped overseas to the United States. The original founder of the legal service concept argued that it would assist the general public just like car insurance or other types of financial protection services.

How the prepaid legal scam works is lawyers and providers convince everyday people that these plans are worth paying for. Often charging outrageous monthly fees, these companies promise to help families and individuals out with any legal problems that may arise during their lives. The problem with this idea is very few (read 1% or less) actually have legal problems that need to be solved through the use of a lawyer. In the end, people spend money on a service they'll never use making these companies unheard of amounts of profit.

Even though this resembles the idea of medical, home, and automobile insurance, plenty of people refer to prepaid legal service as a scam. This of course is to do with money paid in to the service paid out ratio. Frankly, with medical insurance, just about everyone gets sick (some sick a lot) and can make use of the deductibles and savings on medication and pills. And just about everyone experiences a major illness that may have been unaffordable to treat with insurance. On the other hand, with legal services, very few people ever find themselves in legal trouble. And if they do have legal trouble, often the expenses (without a lawyer) are more than manageable.

The final problem with prepaid legal services is, even though you're paying for protection, there are certain trials and cases that may not be covered AT ALL even though you're paying for legal service. For example, if you were on trial for murder and had prepaid legal protection, you won't be covered. The hundreds to thousands of dollars you have paid for protection has now been thrown away because of that.

In conclusion, while prepaid legal service can be perceived as a scam, in reality it's not. The truth about prepaid legal is it's not very useful for most people. If you're someone that may find themselves in more legal trouble than the average Joe, then you may be interested in the service, but, if you're just an average U.S. citizen, the usefulness of prepaid legal will be quite limited.