Legal protection insurance: Your protection in the event of a dispute

If you have to assert your rights in court or with the help of a lawyer, your legal protection insurance will cover the costs incurred. This means you can face legal disputes with your landlord, employer or authorities with greater peace of mind. Here we show you what costs legal protection insurance covers and whether it is worthwhile for you.  

What is legal expenses insurance?

Your legal expenses insurance covers the costs of legal proceedings in and out of court. This means that it covers your lawyer's fees if you are represented in court or out of court. It also covers the costs incurred in connection with legal proceedings and pays your costs if you lose in court.  

Please bear this in mind: Your insurance does not cover all legal costs incurred. In fact, costs will only be covered in the areas of law covered by your tariff. 

Why is legal protection insurance useful?

If there is a dispute in court, the costs are high. If you lose in court, for example in connection with an action for eviction due to personal use, you will incur court and lawyer's fees of around 4,000 euros (depending on the amount in dispute). If you lose the case, you will have to bear these costs yourself - every legal dispute therefore means a certain cost risk for you. Legal protection insurance helps you to exercise your rights with peace of mind. 

In the insured areas of law, the insurance covers the necessary legal costs as well as 

• court costs 
• the costs of your opponent if you lose in court 
• Fees incurred for experts and witnesses 
• Travel and translation costs 
• bail (as an interest-free loan) 

The costs incurred will be borne by the insurance company in full or up to an agreed maximum amount. If a maximum sum has been agreed, this is often between 3,000 and 6,000 euros per year or per claim. Most insurers also offer you the option of getting advice from legal experts over the phone. The hotlines are usually available around the clock.  

If you take out legal protection insurance, you are not only securing yourself competent legal advice. You also ensure that you can enforce your rights in court without having to worry about the financial risks of a lawsuit.  

What benefits does legal protection insurance provide?

Your legal expenses insurance covers costs relating to legal disputes in the areas of law covered by your insurance tariff. The most important areas for which you can take out insurance are Professional legal protection, private legal protection and traffic legal protection. 

• If you take out insurance for private legal protection, your insurer will cover the costs incurred in connection with disputes in the private sphere. Typical disputes in the private sphere include those relating to online purchases, defective repairs, disputes with insurance companies, in the neighbourhood or with the landlord.  
• If you take out professional legal protection insurance, your insurer will cover the costs incurred in disputes with your employer. Typical disputes in this context are, for example, actions for unfair dismissal or those directed against incorrect payslips and unjustified warnings.  
• If you take out traffic legal protection insurance, your insurer will cover the costs arising from your participation in road traffic. Typical disputes include action against unjustified points or claims for damages following an accident.   

Who needs legal expenses insurance?

Whether legal protection insurance is worthwhile for you depends on your individual situation. Therefore, ask yourself whether and in which areas of your life you could face legal trouble. Do you drive a car every day or are you threatened with legal disputes around your workplace? Then it may make sense to take out traffic or employment legal protection insurance. If, on the other hand, you don't own a car and have a secure job and a fair employer, insurance cover is less worthwhile.  

How sensible legal protection insurance is for you also depends on how likely you think it is that you will need a lawyer or have to go to court. The more likely this is, the more urgently you need legal protection insurance.  

It also makes sense for you to take out insurance if you want to protect yourself from the high costs of legal disputes regardless of these considerations. This way, you are sure to be able to enforce your rights against financially strong third parties if necessary.  

When does private legal expenses insurance not pay out?

Your legal expenses insurance covers the costs of contractually agreed disputes. Nevertheless, it is not an all-round carefree package in connection with the insured disputes. If the conflict that triggered the costs incurred already existed before the insurance contract was concluded, the insurer will not pay.  

You also have to wait around three months before you can claim insurance benefits. The waiting period is intended to protect the insurer from you only taking out the insurance once costs and legal disputes have become apparent. Only in connection with traffic accidents will your legal expenses insurance cover you without a waiting period.  

Please note that there are cases in which legal expenses insurance does not pay. These are

• the defence against claims for damages due to breach of contract  
• Disputes in the areas of construction, construction financing and house, apartment and property ownership 
• Disputes relating to trademark, copyright and patent rights 
• Intentional criminal offences 
• Legal disputes relating to speculative investments, gambling and betting contracts 
• Disputes in connection with commercial or self-employed activities  
• out-of-court disputes with the social security or tax office  

The cases in which insurance cover is excluded can vary from insurer to insurer. So take a close look at the insurance conditions and consider which offer suits you best. My team and I will be happy to help you compare different legal protection offers. 

What does legal protection insurance cost?

The cost of your legal protection insurance depends on which insurance package you choose. You can get traffic legal protection insurance for around 70 euros per year. If you opt for legal protection insurance that covers several areas (professional, private, traffic and criminal legal protection), the insurance will cost at least 200 euros per year. The rule is: the more legal areas the insurance covers, the more expensive it is.  

Finding the right tariff - what you should bear in mind

Once you have decided to take out legal expenses insurance, it is important to compare the tariffs of several providers. There is no such thing as a tariff that suits all policyholders. When making your choice, pay attention to the tariff details that are important to you personally. However, don't opt for the first provider that meets your tariff requirements - pay attention to the following points:  

• Area of validity - Choose a tariff that offers cover in other EU countries and for a limited time worldwide. This way, you'll also be well protected when traveling 
• Mediation costs - Not all disputes end up in court. Therefore, choose a tariff that also covers the costs of out-of-court mediation proceedings. The insurance should pay at least 3,000 euros for mediation proceedings. This allows you to settle disputes more quickly and without going to court 
• Free telephone advice - opt for a tariff that includes free telephone advice on the insured areas of law. This means you can get expert help quickly if legal problems arise 
• Low deductible - Make sure that your chosen tariff provides for a maximum deductible of 250 to 300 euros. An excess lowers the insurance premium. However, it should be low enough and not prevent you from taking legal action in the event of a dispute 
• Insured persons - Check whether a family policy is an alternative for you. Family tariffs allow you to insure your spouse or partner and underage children at a reasonable price 
• Short waiting period - Make sure that your plan has as short a waiting period as possible. The shorter the waiting period, the sooner you can claim insurance benefits after taking out the policy 

Are there alternatives to legal expenses insurance?

If you decide not to take out legal expenses insurance, you are not without protection in connection with many legal disputes. Although the alternatives do not offer the comprehensive protection of legal expenses insurance, they are a real relief in an emergency:  

• If you are a tenant, the tenants' association can help you with all aspects of tenancy law. For a membership fee of 50 to 100 euros, you can get legal protection insurance for tenancy law. This pays for your legal advice in the event of problems with the landlord and finances the necessary help to enforce your rights 
• If you own a house or apartment, you may be eligible for membership of a landowners' association. This association offers legal advice and legal representation for all aspects of your property 
• If you are a trade union member, you can fall back on the legal protection provided by your trade union in the event of problems relating to your employment relationship 
• If there are claims for damages against you, these can be handled via your private liability insurance 
• If you have a low income, you can fall back on legal aid for court disputes. You can obtain further information on this and on the possibility of taking advantage of free legal advice in out-of-court disputes from your local court  

On the safe side with legal expenses insurance

If legal disputes arise, they can be costly - with lawyer, court and expert costs. Legal expenses insurance offers reliable protection against high costs. In selected areas of law, it covers all costs incurred in and out of court. Whether legal protection insurance is worthwhile for you depends on your personal circumstances. If you are a professional and actively participate in road traffic and public life, you should consider taking out insurance.