Pre-paid legal plans typically offer, through participating attorneys and law firms, certain affordable civil law and criminal law services to the general public for a fixed, recurring charge. A PPL does not replace the public defender system, but rather provides access to private-sector legal services that subscribers otherwise might not easily be able to afford. This is possible because, as with auto, life and medical insurance, the insurer makes a profit on the aggregated subscriber fees that is in excess of the costs of underwriting subscribers’ actual usage of the available services. The participating legal service providers receive a reliable stream of clients and a streamlined billing process; the clients receive lower-cost legal services and consistent expectations with regard to billing and accountability; and the insurer receives continual collective income derived from many subscribers (also known as members, clients, the insured, etc.).
In many jurisdictions, PPLs are legally classified as insurance and are regulated as such (e.g. by a U.S. state’s insurance commission). In these jurisdictions, a would-be provider of such services must usually obtain some kind of license before they are able to market subscriptions (memberships) in a pre-paid legal plan. In other areas, a pre-paid legal service is simply a business, requiring only a business license.