Here are the reasons why your startup needs the kind of legal expertise and attorney-client relationship that goes beyond the scope of group legal insurance coverage. We’ll explore the potential pitfalls of using group legal insurance for your startup and share suitable alternatives to ensure your young business is protected and prepared for every stage of its growth.
One Size Doesn’t Fit All
When it comes to your startup’s legal needs, there is no such thing as a one-size-fits-all solution. While there are some documents that every business needs–articles of organization, an operating agreement, and a company handbook–there are additional legal documents that every business needs that are unique to that business’s operations and the owner’s aspirations and definition of success. Your business’s exit strategy, cash flow, expenses, and projected growth must be taken into account to provide comprehensive documents that will serve you and your business.
Your current employer’s group legal insurance plan may offer some business legal services, but a generic set of business documents simply isn’t enough to protect your business and set it up for long-term success. To create a successful business, the process needs to begin with an evaluation of your business goals, your exit plans, and your plans for financing the business and growing the business. This is why we don’t have a one-size-fits-all solution for business owners, but instead begin our work with you by looking holistically at everything that makes up your company.
Legal Insurance Plans Nickel and Dime
Many group legal insurance plans boast free legal services after your deductible is paid, but what isn’t revealed is the limit of the coverage.
Only certain types of legal services are covered under group legal insurance plans. Business law is frequently covered, but the kind of work you’ll receive is a mere set of documents, similar to what you could create yourself online, and not a customized, well-counseled strategic plan that will be sure to work for your business and your life.
More importantly, most legal insurance plans have limits to the amount of claims you can file for each type of service each year. For example, you may only be covered to create your company’s operating agreement once a year, but won’t be covered if you need to edit the operating agreement mid-year due to changes in your company’s structure or processes. Business planning isn’t something you do once, as your goals in life will change, your business will change, and the law will change. Business documents created through a legal insurance plan won’t keep up with those changes, so you may receive documents, but those documents aren’t likely to be what your business will need when something happens to you.
You Need a Heart-Centered, Counseling-Based Planning Approach
Owning your own business is far more than filing Articles of Incorporation or running payroll. It’s also about proactively avoiding issues for your business and creating strong systems that your business can leverage for planning and growth.
The needs of your business and the challenges you’ll face as a business owner are constantly changing. That’s why it’s crucial to work with an attorney who has an ongoing relationship with you and your business and who can advise you strategically throughout your business journey, rather than just serving you one time with incorporation of your business, but with little understanding of your business needs.
Legal Insurance Plans Lack Long-Term Considerations
You may own your business for a short time or a lifetime, but no matter how long you own your business, it requires a continuum of proactive strategic legal planning in order to limit liabilities and run smoothly.
Your business may expand, team members may be hired and let go, and tax laws change. Your business’s legal services need to keep up.
Sadly, group legal insurance makes it impossible for the attorneys it contracts with to get to know your business or provide the kind of ongoing strategic legal guidance that yields meaningful results.
Under group legal insurance, your choice of attorneys is limited to the firms that have contracts with the insurance company, and there is no guarantee that the attorney you worked with this year will be available to help with changes in your business next year.
Certain areas of business law, like negotiations and workers’ compensation, may not even be included in your coverage at all. Time-sensitive legal work needed as a result of a filing deadline or an emergency that affects your business’s succession plan may be impossible to carry out when using an attorney through group legal insurance.
Trusted Expertise in Business Legal Services
While group legal insurance may seem like the ultimate way to get your startup’s legal needs taken care of, the services available through these group insurance plans simply aren’t comprehensive or strategic enough to ensure you and your business get the support and guidance you need. Instead, it’s crucial to work with an experienced business attorney who gets to know you and your company on an intimate level.
If you want to feel like your business attorney is a part of your team and not just an insurance claim, schedule a phone call.
AB Law, PLLC is a full-service business law and estate planning firm that serves clients throughout Texas. All consultations are free and no question is too silly, ridiculous, or complex. https://calendly.com/ablawpllc www.ab-firm.com