The downturn in the economy has created increased demand for group legal plans from brokers and consultants, their employer clients and employees. Brokers are recommending group legal plans to employers who are trying to do more with less benefit dollars, and employers are implementing them as a way to help employees manage their financial well-being while remaining productive on the job. Employees are increasingly using their plans to address creditor, debt and real estate matters caused by difficult economic times.
Brokers Embrace Group Legal Plans
This year, retention and controlling costs were again the top two benefits objectives for benefits professionals according to the 7th Annual MetLife Study of Employee Benefits Trends. As such, brokers are increasingly recommending group legal plans to their Fortune 500 clients as a tool to help them attract and retain talent at little or no cost to the employer. In the past five years, the number of Fortune 500 companies offering a group legal plan increased 40 percent. Currently, nearly 150 Fortune 500 companies offer a group legal plan.
"Employers trying to maximize limited budgets realize that traditional benefits are no longer enough, so we recommend group legal plans and other voluntary benefits as a viable option for them in today's economy," said Dave White of D. M. White Corp. in Phoenix. "By offering a group legal plan, they not only enhance the competitiveness of their benefits package, they provide a valuable resource for employees, many of whom need legal assistance with financial matters now more than ever."
Demand from Employers is on the Rise
Employers are adopting group legal plans as a way to help employees protect their rights, families and assets. Due to the current economic downturn, employees are more reliant on their employers to provide a financial safety net, according to the 7th Annual MetLife Study of Employee Benefits Trends. Employers recognize group legal plans as a way they can help employees manage difficult financial situations since most legal plans cover attorney assistance with home equity loans, refinancings, sale or purchase of a home, review of mortgages and deeds, debt collection defense, foreclosure and personal bankruptcy.
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Employee Usage Surges in Difficult Financial Times
Employees who are facing difficult times due to the current economy are turning to their legal plans for assistance. In the fourth quarter of 2008, compared to the fourth quarter of 2007, legal plan usage in Hyatt Legal Plans' voluntary plans for mortgage services increased 67 percent, usage for refinancings and home equity loans increased 24 percent, and usage for property tax assessments increased 218 percent. Consultations on real estate matters were up 35 percent. Usage of Hyatt's plans for financial matters also increased significantly. Again, comparing the fourth quarter of 2008 to the fourth quarter of 2007, usage for personal bankruptcy increased 66 percent, usage for debt collection defense increased 27 percent, and consultations on financial matters increased 120 percent.
Summary
As brokers continue to recommend legal plans to their clients, and employers recognize their value as a tool to aid in retention, the demand for group legal plans is likely to continue to rise. Usage and enrollment also are likely to continue increasing as employees recognize their tremendous value in difficult financial times.
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