What is legal protection?
Legal insurance in Switzerland is divided into two distinct categories:
- Legal insurance for road users or motorists (and boat users)
- Legal insurance for private persons
It is recommended to always subscribe to a combined package, even though some providers enable their clients to only subscribe to road user protection, which includes all road users, including cyclists, pedestrians, drivers and passengers.
The combined package covers compensatory damages in the following cases:
- Disputes with an employer
- Disputes with a landlord
- Disputes with a third party (such as a neighbour)
- Disputes with an insurance company
- Contractual compensation
- Non-contractual compensation
- Disputes with car rental companies
- Motor vehicle taxation issues
- Administrative procedures related to motor vehicle fines
- Criminal law
Certain providers offer limited coverage for:
- Property and building law
Compensatory damages are not covered for the following cases:
- Family issues (divorce, inheritance)
- Tax disputes and issues
- Bankruptcy related issues
- Intentionally committed offenses
- Isolated expenses (fines, deeds, registration in official registers)
- Issues related to investment funds, securities, bonds and other financial affairs
- Betting and gaming issues
The better providers will provide free legal advice on the above.
Our expert’s recommendation:
Any dispute that began before the date of subscription will not be covered and a three month waiting period is applied to legal insurance in Switzerland, so it is important to subscribe to this protection sooner, rather than later. To benefit from full coverage be sure to subscribe to combined private and road user protection.
What amount should I be covered for?
Attorney fees in Switzerland are anywhere between CHF 350.- to 800.- per hour and a retainer or an advance of ten hours is common practice. A retainer on cour costs is also required to receive a case in court. If the lawsuit is lost all the legal costs of the opposing party must also be borne by the claimant. In short, legal action is expensive. To avoid the financial risk one can decide not to go to court as a claimant; but what happens if one is the defendant? The defendant is obliged to protect their rights, so the above legal fees cannot be avoided.
The amount covered should therefore never be less than CHF 50’000.-, and more just adds further financial security.
Our expert’s recommendation:
Always check the territorial validity of the coverage and the amounts covered in and outside of Switzerland. We also advise to check the maximum hourly rate the provider will pay for an attorney, this is often capped at a certain amount, obliging the client to pay part of the fee themselves. A final important consideration is whether or not the provider offers the free choice of attorney or imposes one.
What deductible should I choose?
No deductible will apply to any serious legal insurance policy.
What amount is reimbursed in case of a claim and which costs are covered?
The amount specified in the insurance policy as it is a lump sum insurance.
The following costs are covered by legal insurance:
- Attorney fees
- Expert fees
- Legal and procedural costs
- Costs due to the opposing party
- An advance on cour costs
- An advance on bail
- Translation costs
- Publication costs if required by a foreign court
What option should always be included in the legal insurance plan in Switzerland?
The free choice of attorney.
Examples of legal insurance claims in Switzerland
.A’s rent is increased by an excessive amount
A can use the legal insurance to ask the landlord to justify the rent increase.
.A is not refunded for medical care
A can ask the legal insurance to write a letter to the insurance company asking them to justify their position.
.A is made redundant
A can ask the legal insurance to check that his or her basic rights were respected throughout the redundancy process.
.A receives a parking or speeding ticket or has their driving license withdrawn
A can ask the legal insurance to check that the law has been respected in the event of a fine or license withdrawal.
.A is about to sign a binding contract
A can ask the legal insurance to read the contract before they sign it to check that it respects local rules, laws and obligations.
Glossary of Swiss insurance terms – Legal insurance in Switzerland
Compensatory damages
Compensatory or actual damages refer to an amount of money that must be paid to a person as compensation for a loss or an injury. The compensation can be for a pure financial loss related to a legal dispute or for an emotional damage.
Court costs
Court costs are the costs related to bringing a lawsuit in front of a judge in a court of law.
Generally speaking the higher the amount in dispute the higher the court costs are.
Claimant
The claimant is the person making a claim against the defendant.
Lump sum insurance
The amount or amounts insured are capped at the amount(s) specified in the insurance policy.
