With insurance, the idea is that you take it out to cover rare cases with high cost implications. The same applies to legal protection insurance: the probability is low that one will need legal protection insurance in the next few years. But if then an accident or other liability case occurs, then one is glad that the legal protection insurance takes over the high costs. Litigation can be downright ruinous if you take a case from the first instance to the Court of Appeal and then to the Federal Supreme Court, where you lose. Then you have to pay the court and lawyer's fees of the other party, which can quickly mean several tens of thousands of francs in costs.
Premiums for legal protection insurance range from 150 to 400 Swiss francs annually for individuals or families. There are two legal protection insurances, which can be taken out either individually or as a combined package: The private legal protection insurance as well as the traffic legal protection insurance.
Private legal protection insurance
Private legal insurance covers the following areas:
- Indemnity
- Insurance law (z.B. Disputes with health insurance companies, pension funds, insurance companies)
- Patients
- Labor law
The tenancy and neighbor law, inheritance law, debt enforcement and bankruptcy law as well as property law (z.B. patent law, copyright law) are covered differently in some cases and can be affected by waiting periods of z.B. be limited to 3 months.
Traffic legal protection insurance
Legal expenses insurance for traffic idR cover the following areas:
- Indemnity
- Insurance law (e.B. Disputes with health insurance funds, pension funds, insurance companies)
- Criminal law in case of non-observance of traffic regulations
- Revocation of driver's license
- Vehicles (purchase, rent/lease/lease, repairs)
Problems with legal protection insurance
The biggest problem you can have with legal malpractice insurance companies is that they don't want to take the case and therefore the costs. If you are the one who caused the damage, for example, because you were careless and had an accident because of it, you cannot expect help from legal expenses insurance. Here you have to turn to your own private liability insurance.
The case is less clear when the legal protection insurance reviews the case and believes that going to court would be futile. Legal protection insurance aims to avoid having to pay high legal fees that are not covered by the opposing party. Thanks to a regulation on legal protection insurance, however, it is possible to turn to arbitration in the event of a disagreement with the legal protection insurer. In addition, there is the case where an insurance company refuses to provide assistance and the insured person still goes to court. If the latter wins the case despite the alleged hopelessness, the legal expenses insurance must subsequently pay the legal fees.
What legal expenses insurance pays for
The following costs are covered
- Fee for lawyer*
- Costs for expert opinions
- Court fees
- Compensation to the other party
- Penalty Bonds
* note that depending on the insurance company, one cannot always freely choose one's own lawyer, but must choose from suggestions made by the insurance company.
Depending on the legal expenses insurance, certain restrictions may also apply. For example, the maximum coverage of costs may be limited to 250,000 Swiss francs. Or only cases that would be brought before a Swiss court would be taken over. In the case of traffic legal protection insurance, particularly serious cases such as massively excessive speeds (30 km/h in built-up areas, 50 km/h on freeways) can also be excluded.
Premiums are small in relation to potential legal fees. However, the probability of being involved in an expensive legal dispute is also low. All in all, everyone has to judge for themselves whether they want to take out legal protection insurance or not, in order to reduce their risk, or whether they could bear the costs of a lawsuit themselves in the worst case scenario.