How much does it cost to hire a long-term disability lawyer in Canada? Great question! And yes, it usually depends on a lot of things. Lawyers are notorious for answering every question that way, right? Well, to counter our notoriety, I’ll do my best to give you a clear answer. Several, actually.
I’ve represented people in disability claims for over 15 years and have worked almost exclusively in this area for the past five. I founded Resolute Legal specifically to represent people in disability claims. I’ve worked with over a thousand clients in disability cases and thousands more in consultations. All of that means I have a good idea of what hiring a disability lawyer, either me or someone like me, can cost.
Because the cost depends on a number of factors, I’ll review them to give you an idea of what you could expect to pay in your situation. Keep in mind that I base my cost ranges on my experience and research. So you could pay more or less in certain circumstances.
Bottom line? Hiring a disability lawyer can cost between $50 and $100,000 (in extreme situations). But don’t worry. I’ll take you through the factors that affect costs so you can better predict what you might have to pay.
Let’s start with the two biggest drivers of legal costs in disability claims:
- the lawyer’s financial risk
- the scope of work
The Disability Lawyer’s Financial Risk
The financial risk involves how a lawyer receives payment. Lawyers can charge hourly rates or fixed prices for certain services. They can also work on a contingency basis, known as no-win or no-fee. That means if you don’t win your claim with the lawyer’s help, then neither of you gets paid. Contingency fees usually cost more than hourly or fixed fees because the lawyer takes a larger risk of not getting paid.
The scope of work refers to the type, amount, and difficulty of work you want the lawyer to do. Do you want just one consultation about your options? Do you need a lawyer to help with paperwork for a few days? Or do you need full legal representation for several months?
Now let’s get into the details of the scope.
Scope of Work For Your Disability Claim or Issue
Naturally, the greater the scope, the more it will cost. Lawyers handle most long-term disability claims with four types of services:
- free consultation
- paid consultation
- full representation
Each type expands in scope – and price, of course. Let’s review each.
What can be better than free? Except don’t you get what you pay for? And nothing in life is free? And I’m sure you’ve heard others, so you get the picture.
Almost all law firms that market themselves as “disability lawyers” will offer some type of free consultation. These “free” consultations come at a low cost with your name and contact information. Law firms won’t sell your information to telemarketers, but they consider it valuable because you may become a client. You may also refer them to people you know, who in turn, may become clients. That makes your free consultation valuable to them.
However, a free consultation may not give you the answers you want. For the most part, free consultations only give general information about your rights and options. Also, you may wind up seeing a paralegal or other member of the law firm’s customer support team instead of a lawyer.
Still, free consultations are great when you need general advice. For example, if you want to know about the services a law firm offers and if they would fit your situation. Or you want to learn about how disability appeals work and what you get and don’t get when you hire a lawyer. If you go in with the right expectations, free consultations can help both you and the law firm. You’ll be disappointed if you go in expecting answers to complicated questions.
A paid consultation is a one-time service where you pay the lawyer for specific legal advice on your situation. For complicated questions, the lawyer will usually need to review documents and get certain details from you.
You might want to consider a paid consultation if you believe you may lose legal rights or benefit payments from the wrong decision or if you have another high-stakes issue. The lawyer can educate you about the issue, explaining your rights, the options, and their pros and cons. After a paid legal consultation, you should feel more comfortable making a decision.
Paid consultations can cost anywhere from $50 to $1,000 (plus HST), depending on the difficulty of your issue, the need for research, and the number of documents the lawyer has to review. For most common issues and questions, you should prepare to pay in the range of $50 to $300.
Lawyers most often charge by the hour, usually between $150 and $500 per hour. They track their time in six-minute increments and multiply the time spent with you by their hourly rate to give you a bill. Make sure you confirm the hourly rate and get a time estimate to get a rough idea of how much your consultation will cost.
Clients generally prefer paying fixed fees so that they know exactly what it will cost, regardless of how long the consultation takes. That way, you can concentrate on your legal issues instead of the clock.
Fixed fees differ among law firms but mostly fall in the range of $50 to $500.
Projects involve more than a one-time consultation but less than full legal representation. You may hear these services referred to as “limited-scope legal services” to distinguish them from full legal representation. I like to call them projects because it makes more sense to most people.
Common projects include:
- Preparing applications for disability benefits
- Managing an internal appeal with the insurer
- Representing you at an appeal hearing
As with paid consultations, you can expect lawyers to charge by the hour or with fixed fees. Let’s go over these common projects so you know what you might need.
Application for disability benefits
You can expect to pay in the range of $500 to $5,000 for this service, depending on the complexity of your application, how thorough you want the lawyer to be, and whether the lawyer has financial risk. You’ll pay less if you just want the lawyer to help you fill out the forms. If the lawyer has to request documents from other agencies, prepare legal submissions, and work on a no-win, no-fee basis, it’ll cost more.
Preparing an internal appeal
Working with a lawyer on an internal appeal generally ranges between $500 and $7,500. On the lower end of the scale, you can get an intimidating letter sent to the insurer outlining why the claim should be approved. But if you want the lawyer to collect documents (medical records, insurance claim files) and do thorough legal submissions, you’ll have to move up the pay scale. Again, paying the lawyer upfront (win or lose) will cost less than payment after you win.
Representation at an appeal hearing
Hiring a lawyer to represent you at a hearing can cost $5,000 to $15,000, once again depending on how much help you want and when you want to pay the lawyer, before or after. Keep in mind that you don’t have to have a lawyer at a hearing, but you can improve your chances of winning if you do.
Full Legal Representation
In full legal representation, you hire a lawyer to represent you in all aspects of a legal dispute. You might hire a lawyer for a long-term disability claim to handle all appeals or lawsuits against the insurer. You also authorize the lawyer to speak on your behalf and represent you in meetings or legal proceedings.
Full legal representation can last for months and even years, and you’ll pay between $5,000 and $100,000 in hourly, fixed, or contingency fees. You might manage to stay on the low end of the charges if you pay an inexperienced lawyer up front to handle a simple appeal that resolves quickly. You’ll definitely pay more for complex appeals, seasoned lawyers, extra work, and/or no-win no-fee arrangements.
While full legal representation can result in the highest legal fees, you may qualify for partial reimbursement of those fees, called payment of legal costs, if your lawyer wins your case or negotiates a settlement with the insurer. I have listed $100,000 as the upper limit, but I have never actually charged a client that much, even in a no-win, no-fee situation.
For example, Ontario insurance companies will usually pay a legal fee reimbursement of just under 50%, turning a legal fee of $30,000 into $15,000 to $18,000. Of course, insurers would rather not pay your legal fees, so your lawyer would have to fight for this.
Finally, if you hire a lawyer under a no-win, no-fee agreement and you lose the case, then at least your legal fee will probably total $0. Depending on your agreement with the lawyer or third-party lenders, you may still have to pay them back for any legal disbursements.
Does the Insurance Company Have to Pay My Legal Fees
We brushed over this in the previous section, but it’s important to fully understand the situations when an insurance company will cover your legal expenses because they aren’t always required to. The first thing you need to know is that legal fee reimbursements are only triggered when you file a lawsuit. So, if you hire a lawyer early on and they are just helping with appeals, but there’s no lawsuit, then even if you are successful with the appeal, the insurance company won’t have to pay any part of your legal fees. However, once your lawyer files a lawsuit, that triggers rules that require the insurer to repay part of your legal fees — so long as you win your case.
That brings me to my next point: In Canada, we follow the ‘English system’ of “loser pays” court costs. So, if you lost the appeal, the insurance company wouldn’t have to reimburse you for your legal expenses. However, if you successfully reach a settlement or win your case in court, then the insurance company would be required to pay for part of your legal fees.
The amount the insurance company has to pay is going to be different depending on what province you live in, but generally speaking, it will never be more than 40 to 50% of your legal fees.
However, remember that these same rules apply to you — if you lose the case, you may be required to pay the insurance company’s legal fees. To learn more about this, check out our article: Will I Have to Pay My LTD Insurer’s Legal Fees If I Lose My Case?
Recap: How Much Does a Disability Lawyer Cost in Canada?
Quiz time. So, how much does a disability lawyer cost in Canada?
Answer. Hiring a lawyer for a long-term disability claim can cost between $50 and $100,000, depending on the scope of work and the lawyer’s financial risk. One-time consultations range between $50 and $500, depending on the complexity of your situation. Short-term projects (applications, internal appeals, appeal hearings) may cost between $500 and $15,000. Full legal representation costs between $5,000 and $100,000. With a no-win, no-fee agreement, your legal fee may be $0 if your lawyer can’t help you win your case. However, if you win, the insurer may pay up to 50% of your legal fees.
Choosing a lawyer is a very personal and important decision. Please don’t rush it because you feel desperate or frustrated or because you believe all lawyers are the same.
Before you decide, download and read our free 7-Step Guide to Hiring a Lawyer for Your Long-Term Disability Appeal.
And, if you have any questions about this article or your claim, feel free to book a free consultation with us. You can reach us toll-free at (888) 732-0470.