Tired of skyrocketing legal fees? You do have another option--prepaid legal plans.
Prepaid legal plans have been compared to HMOs because they offer certain basic services for a monthly fee. Prices range from as little as $10 a month to $70 or more; in return, an entrepreneur gets a package of services such as, say, unlimited phone consultation with a lawyer, review of three contracts per month, up to 10 debt collections per month and discounts on other legal services.
Typically, prepaid legal services contract with one law firm in each state to handle routine matters. Because the service is usually that firm's biggest client, small-business owners using the service receive a warmer welcome than they might at a big law firm. Specialists are usually available at reduced rates.
When considering a prepaid legal service, here are some factors to consider:
- What is included? Check the plan to make sure they've got what you need. The number of services offered at a reduced rate may be limited; what do they charge for other services?
- Consider whether you'd prefer to build a relationship with one attorney rather than talk to a different lawyer every time you call.
- Ask other entrepreneurs who have used such services about the quality of work. Also ask how the company handles conflicts of interest in case you have a dispute against a business that uses the same prepaid firm.
With these caveats in mind, a prepaid legal service firm could be just what a business on a budget needs. For more information, contact the American Prepaid Legal Services Institute.
This article is excerpted from Start Your Own Business: The Only Start-Up Book You'll Ever Needby Rieva Lesonsky and the Staff of Entrepreneur magazine