Have you heard about Legal Expense insurance? Most small business owners know that they need liability insurance and property insurance to protect their business. But did you know that there are a lot of things that conventional business insurance can’t or won’t cover? Two common claims that are excluded in many commercial policies are employment and contract disputes.
As a small business you don’t have the same resources as a large firm. If you get into a dispute with a big company you could end up being bullied into giving in simply due to cost. Legal Expense Insurance is a cost-effective way to make sure that this doesn’t happen — and give you a whole host of other benefits too!
1. It Fills gaps in your commercial insurance
Conventional commercial insurance won’t cover if an ex-employee sues you or if you get into a contract dispute with another company. Our Legal Expense Insurance coverage allows you to both defend and pursue your legal rights in a contract dispute. It also defends your legal rights if there is an employment dispute.
Other items that regular insurance won’t cover like criminal investigations and appealing statutory notices / license suspensions are also covered by Legal Expense Insurance.
2. It's like having a lawyer on speed dial
Unlimited free telephone legal advice means that you can always get an answer to your legal question, no manner how minor. Before you fire an employee you can consult with the lawyer over the phone to make sure that all of your boxes are checked. You can ask about what to do next if somebody threatens to sue you or is trespassing on your land.
Best of all is that use of the telephone legal advice doesn’t affect your premiums — we encourage you to call as often as you need!
3. It pays legal expenses to help keep you in business
1 in 10 small business end up going out of business due to a legal dispute. With legal expense insurance things like contract and employee disputes won’t sink you financially. This means you can be confident you won’t have to give in to unreasonable demands just to save in legal bills.
4. You can use it as a free “second look” if your claim is denied
Getting a claim denied by your insurance sucks – especially when you believe that it should have been covered. With Legal Expense insurance you can have a third party lawyer look over the facts of your claim to determine if it should have been covered. If they think you have a 51% chance of winning they will go to bat for you to get the insurance company to cover the claim.
5. It pays for a tax attorney if you get audited
Even for a simple audit, you want to make sure your paperwork is straight so you don’t end up paying something you don’t have to. With up to $200,000 in legal fees for a tax attorney you can make sure your affairs are 100% in order before submitting to Canada Revenue Agency so that you don’t get penalized.
6. Lawyers are expensive!
The average cost of a two-day trial in Canada is now over $30,000 with rates for even an inexperienced lawyer at $200+ per hour. Even if your business has extra cash, do you really want to spend it on a legal battle? Legal Expense insurance is a smart investment to protect your cash flow and your company.
7. You can use it to pursue your legal rights and collect bad debt
If somebody damages your property or doesn’t pay their bill you might normally do a cost analysis. Is it going to be worth it to pursue the person or will you end up paying more than you get? With Legal Expense insurance you don’t have to worry about the legal fees to collect from those who have destroyed your property or refuse to pay their debts.
8. Legal disputes are inevitable – having to pay a lawyer for them isn’t
~36% of small business are involved in at least one lawsuit any given year – and 90% of all businesses experience a lawsuit at some point in their lifespan. Legal disputes happen and being able to speak to a lawyer about the proper course of action is invaluable even if a threat of a lawsuit never turns into a real one. Rather than taking a hit to your bottom line or being one of the 29% of small business owners who choose not to hire a lawyer, you can have your cake and eat it too. With Legal Expense Insurance you get the lawyer without the hit to your profit — a clear win-win.
It’s clear — Legal Expense Insurance is a great choice for your small business. Starting at only $200 per year it’s also extremely cost effective. Give us a call at 604-448-9196 now or email us at info@nesika.ca for your free, no-obligation proposal.
If you’d like to know more about the statistics of small business owners and the Canadian legal system you can read this excellent white paper by DAS Canada. They did a research survey to find out more about how small business owners understand and protect themselves from unexpected legal costs.
