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Legal Expense Insurance FAQs

Have questions? Please see below for frequently asked questions from regarding legal expense insurance, LEI for dentists, education professionals, physicians and surgeons, and commercial LEI.

General Questions About Legal Expense Insurance

Legal Expense Insurance (LEI) provides affordable coverage for the legal fees and expenses incurred by a lawyer on specified matters. These matters are defined as fortuitous events, or issues that are not anticipated. These could include employment disputes, litigation, disciplinary actions, Human Rights complaints and criminal charges. Cover is not discretionary i.e. provided the claim is covered within the governing terms and conditions of the policy, the policy responds. Legal Expense Insurance products can also offer coverage for predictable events such as a Will or Power of Attorney.

Prepaid plans provide coverage of legal fees for a set list of predictable needs requiring legal assistance. These include preparing a will and negotiating a mortgage. The funding is a pool of money and cover is discretionary, depending on the stability of the pool. There is no form of regulation for prepaid plans. See: What is Legal Expense Insurance?

There is no such thing in Canada. By law, insurance can only provide coverage for fortuitous events (i.e. unpredictable or accidental). Therefore predictable legal events such as preparing a will or negotiating a mortgage cannot legally be covered by insurance in Canada.

Legal Expense Insurance (LEI) provides affordable coverage for the legal fees and expenses incurred by a lawyer for professional matters covered by the policy.

We live in a litigious society. Having access to a lawyer when you need it provides you with peace of mind, while at the same time protecting your financial bottom line. More importantly, having legal representation when a conflict arises has proven to help mitigate problems and assist all parties to reach a suitable compromise without costly settlements or long, drawn-out court cases. With its low cost premium, Legal Expense Insurance means that you are not facing catastrophic legal costs at the same time as you are dealing with a conflict. Legal costs for actions brought against you can easily climb to $100,000 or more.

As part of the coverage provided by LEI, policyholders have free access to a toll-free hotline that connects them with a lawyer between the hours of 9:00 am and 5:00 pm, Monday to Friday, for telephone legal advice. These calls are unlimited in frequency and duration.

Policyholders are connected immediately to a lawyer more than 90% of the time. The remaining 10% of callers will receive a callback, generally within 24 hours.

Policyholders are provided with a toll-free number that provides them with access to a lawyer, Monday to Friday, from 9:00 am to 5:00 pm.

Completely. Solicitor/client privilege is maintained.

Policyholders are advised to contact STERLON, using our toll-free number. Once merit has been established, a file will be opened and you will choose your lawyer from our panel of lawyers who have been selected because of their expertise in matters directly concerning policyholders.

No. However, you will be able to choose your lawyer from our selected panel of lawyers who are experienced in the areas covered by your policy.

By maintaining a panel of lawyers specializing in health care, education, corporate and professional matters, STERLON provides a ready resource for its policyholders, from which you can select competent and experienced counsel. Familiar with the terms and conditions of the policies, these lawyers will ensure that you are afforded maximum protection. Legal costs will be paid directly to them on your behalf. You are not required to pay first and then seek reimbursement.

Most policies provide a maximum indemnity of $275 per hour, plus all reasonable disbursements. Any legal fees in excess of this hourly rate remain the responsibility of the policyholder.

Providing a range of lawyers with varying degrees of expertise and experience provides policyholders with a greater choice. This enables them to select a more expensive lawyer, if they so desire. However ALL lawyers are fully competent and capable of providing excellent representation for policyholders.

Dentists

Coverage provided by the CDPA is not insurance. It’s discretionary coverage that is funded from membership fees. By contrast, PLEI is an insurance cover whereby coverage is guaranteed provided the claim falls within the governing terms and conditions of the policy. In addition, CDPA lawyers are assigned by the Association. Dentists with PLEI coverage can choose their lawyer from a panel of lawyers specializing in dental issues.

If the right steps are taken at the very start, problems can often be resolved quickly or a suitable compromise reached between the parties involved without costly settlements or long, drawn-out court cases that can take you away from your practice and damage your professional reputation.

Until March 2003, STERLON handled all claims for members of the CDPA holding professional legal expense insurance. At that time, the insurer declined to offer renewal terms to this association. Any request for legal fees arising after March 1, 2001, is handled directly by the CDPA’s member benefit plan. Claims open prior to this date continue to be serviced by STERLON.

STERLON does not sell (nor has it ever sold) insurance. STERLON Underwriting Managers Ltd. administers legal expense insurance for insuring companies. Dentists can purchase Professional Legal Expense Insurance (PLEI) and Commercial Legal Expense Insurance (CLEI) directly from PBL Insurance Ltd. For more information emailChris Boynton at PBL Insurance Ltd. (cboynton@pblinsurance.com)or phone toll-free in Canada 1-888-647-6730.

PLEI covers matters NOT covered by professional liability insurance. Such matters include:

  • Criminal charges
  • Breach of contractual right of access to health facilities
  • Regulatory issues
  • Employment disputes
  • College complaints and Disciplinary actions
  • Insurance billing investigations

PLEI pays the reasonable legal fees and expenses of the lawyer (subject to a maximum hourly rate of $275) up to a maximum of $100,000 per claim with a $250,000 annual aggregate limit (maximum payable per year).

Education Professionals

Most school boards do extend some legal protection to its administrators but usually when your interests are the same as the interests of the board. If your dispute is either with the board, or is a matter that runs contrary to board policy, you will likely find yourself without any legal representation. For less than a dollar a day, Professional Legal Expense Insurance can provide you with personal protection.

Professional Legal Expense Insurance provides you with toll-free telephone legal advice between the hours of 9:00 am and 5:00 pm EST for personal matters. These calls are unlimited in both frequency and length.

PLEI provides payment of legal fees and expenses arising from either your conduct or responsibilities as an educational professional. This coverage includes:

  • Any investigation, inquiry and/or hearing before the College of Teachers concerning a matter of fitness to practice and/or discipline and/or misconduct and/or complaint
  • Defence of criminal charges such as harassment or assault
  • Any employment dispute such as contractual terms, demotion, performance issue
  • Defence of any complaint of discrimination undertaken by the Human Rights Commission

You can select your lawyer from a panel of law firms specializing in the education field and there is coverage for the legal fees and disbursements incurred up to a maximum hourly rate of $275.

This insurance will pay the reasonable legal fees and expenses of the lawyer (subject to a maximum hourly rate of $275) up to a maximum of $150,000 per claim with a $150,000 annual aggregate limit (maximum payable per year).

Physicians and Surgeons

Professional Legal Expense Insurance (PLEI) for Physicians and Surgeons is a unique product, specifically designed to provide indemnity coverage to professionals. This distinguishes it from the cover that is provided by the CMPA, which is discretionary.

PLEI covers matters NOT covered by professional liability insurance. Such matters include:

  • Criminal charges
  • Breach of contractual right of access to health facilities
  • Regulatory issues
  • Employment disputes
  • College complaints and Disciplinary actions
  • OHIP Billing investigations
  • Physician Audit Board investigations (replaces Medical Review Committee)

If the right steps are taken at the very start, problems can often be resolved quickly or a suitable compromise reached between the parties involved without costly settlements or long, drawn-out court cases that can take you away from your patients and your practice and damage your professional reputation.

This insurance will pay the reasonable legal fees and expenses of the lawyer (subject to a maximum hourly rate of $275) up to a maximum of $100,000 per claim with a $250,000 annual aggregate limit (maximum payable per year).

Commercial LEI

No. Commercial Legal Expense Insurance (CLEI) is a brand new product that was introduced in Canada in 2005. It is already widely sold in Europe and is specifically designed for small to medium sized businesses that do not typically have legal services on staff. Given the high cost of retaining a lawyer, your company may be put in a position where you have to choose between jeopardizing your financial bottom line by incurring heavy legal expenses, or risking financial difficulty, even bankruptcy and closure, by failing to have proper legal representation.

Commercial liability insurance pays damages for civil issues, including negligence. It does not cover the following five crucial areas:

  • Contract disputes – Pursuit or defence of contractual disputes relating to the sale, purchase, lease or rental of goods or the provision of services (e.g. disputes with customers/suppliers, defence against claims of poor workmanship)
  • Employment disputes – Defence of any dispute with an employee (e.g. defence against wrongful dismissal charges, discrimination)
  • Criminal Prosecution – Defence of criminal or statutory proceedings (e.g. Criminal Code (Canada), Occupational Health and Safety Act)
  • Property Disputes – Pursuit or defence of disputes relating to freehold/leasehold property including damage by a third party to that property (e.g. landlord and tenant disputes, nuisance and trespass)
  • Personal Injury – Pursuit of claims for compensation relating to death or bodily injury sustained away from the workplace but while engaged in business activities

The question you should be asking yourself is, “Can I really afford not to?” CLEI provides you with peace of mind and a premium that is easily affordable, even for the smallest business. That’s because LEI premiums are tailored to your company’s gross revenues. More than just an insurance policy, CLEI provides your company with a complete service and immediate access to a lawyer when you need it.

The best person to answer that question is a lawyer! This is why CLEI provides policyholders with a toll-free Telephone Legal Advisory service. This service gives you unlimited access to a lawyer for immediate advice on any business matter, Monday to Friday, 9:00 a.m. to 5:00 p.m., EST.

If the right steps are taken at the very start, problems can often be resolved quickly or a suitable compromise reached between the parties involved without costly settlements or long, drawn-out court cases that can take you away from the business of running your business.

Commercial Legal Expense Insurance pays up to $50,000 per claim, to an annual total expense of $250,000, for reasonable legal fees (at a maximum rate of $ 275/hour). Legal proceedings must commence in Canada. There is no deductible. A 10% co-insurance applies to all legal fees in excess of $ 10,000.

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