Legal advice soon from insurers? Bavaria's initiative is causing alarm in the legal profession

The lawyer from the insurance company?

What was previously unthinkable could soon become reality: In future, legal expenses insurers should not only pay, but also be allowed to advise and represent clients themselves - at least out of court. This is according to a proposal by Bavarian Minister of Justice Georg Eisenreich (CSU), which is on the table at the Conference of Ministers of Justice (JuMiKo) in Leipzig.

The aim: The Legal Services Act (RDG) is to be amended so that insurers can offer their customers direct help with legal problems - without having to go through a law firm.

The legal profession is sounding the alarm.

Insurance instead of a lawyer? Critics smell cost pressure instead of proximity to citizens

At first glance, the justification from Bavaria sounds close to the people: the aim is to create "low-threshold access" to legal help - especially for minor everyday problems for which a traditional visit to a lawyer is not economically viable. Insurers are often the first port of call for legal issues anyway.

But it's not that simple. Until now, insurers have been prohibited from providing legal advice and representation - for good reason. A lawyer is an independent organ of the administration of justice, legally bound to neutrality and subject to strict professional rules. Insurance companies, on the other hand, are commercial enterprises that have a completely different interest: Cutting costs.

It is therefore probably not entirely coincidental that the initiative comes from an industry that pays around 2.5 billion euros a year to lawyers - and would like to significantly reduce the burden of major proceedings such as diesel lawsuits or GDPR violations. Critics therefore see the Bavarian plan as one thing above all: a cost-cutting program on the backs of consumers.

Many questions - no answers

What exactly this new "insurance legal advice" should look like is completely open. The Bavarian Ministry of Justice refuses to provide concrete answers. And there are plenty of unanswered questions:

• What qualifications should the insurers' advisors have?
• How should conflicts of interest be dealt with when both sides of a dispute are with the same insurance company?
• Does this also apply to commercial mandates?
• And what happens in the event of incorrect advice - who is liable?

The fundamental question also arises: why should insurers suddenly be allowed to provide legal services while law firms are still not allowed to take on external investors? Such unequal treatment would shift the rules of the entire market - to the detriment of small law firms, especially in rural areas.

Comment: Those who want the rule of law must not outsource it

The proposal from Bavaria is more than just a technical amendment to the law. It is an attack on the basic structure of legal advice in Germany. Allowing insurers to provide legal services independently turns independent legal advice into a business model with targets and a cost-cutting logic.

Of course, many people want faster and cheaper legal help. But this cannot be achieved by replacing the defenders of civil rights with employees of an insurance company that wants to pay as little as possible.

Access to justice must not depend on the insurance company's tariff - nor on its interest in costs. If this model catches on, lawyers will become the exception - and the rule of law the product.

Source: lto.de