Now, there are indeed two types of legal expenses insurance:
1) Private sector: disputes with neighbors, family matters and similar.
2) Professional activity legal insurance: fee disputes, difficulties with clients, unfulfilled, financial claims and similar. In the following text, we are going to focus on professional activity legal insurance - but, regardless, always be on good terms with the neighbour!
In the context of freelancer/self-employed life legal insurance is essentially classified as commercial insurance. There are some first steps - of course, defining by industry/trade. It can be especially recommended regardless of industry but if you provide services. For example, when you are offering services or taking/providing supplies there is often a contract involved. It is in this case that likely legal insurance is a good idea. This extends to financial disputes and thereafter. Now, in terms of cost, it would not be advisable to give a price range in this blog post - due to the fact there are so many interchangeable factors - and it really is on a case by case basis. For example, are you working as a freelancer (that is for you alone)? If you have a business or a company, how big is your business and how many employees are you employing? So, here are some last key things to keep in mind when it comes to legal insurance:
It is worth keeping in mind that not all insurance providers cover self-employment. Some insurers have good offers for self-employed, but often they are not so consistent across the market offerings. One thing worth noting in when running through your feasible options is that some companies will not allow you to select your own legal counsel in the event of dispute. Be very mindful of this especially if it is common in your field of work to need specialised legal counsel.
If you have freelance employees or employees, a legal expenses insurance can be quite important. In disputes concerning the employment relationship, terminations or due warnings you will be protected and protected in any legal disputes. A knowledge of the law will help guide you as you set up your employment formations, but, disputes can arise even if you have followed the protocol - so that extra protection can help clean up employee-related matters quite quickly.
Sometimes legal protection can be valuable to also deal with disputes that may arise with the Finanzamt . In this case, you can fully protect yourself (and any language barriers) to ensure a smooth and easy resolution without breaking the wallet!
As always, we can only recommend that you spend as much time as possible educating yourself on the possibilities when it comes to insurance. There are brokers available to give direct advice and remember - these advices should be tailored to suit you and your unique circumstances. There are so many decisions required when it comes to starting/founding/establishing your business and insurance is just as important as, well, all of them! Indeed, it can be the one that gives you little to no incentive to invest in as you are starting out, but it can be the one investment that saves your business, income and/or employees in case you are faced with unique challenges in your business.