Knesset Approves Cap on Legal Fees for Disabled IDF Veterans and Victims of Terror

The Knesset plenum today (Tuesday) approved a bill limiting the legal fees charged by attorneys representing disabled IDF veterans, members of the security forces, and victims of terror attacks. Fourteen members of Knesset voted in favor of the bill, which passed without opposition.

The bill combines a private member’s bill submitted by MK Michael Biton with a government bill. The law is intended to protect those eligible through the Rehabilitation Department and the National Insurance Institute from excessive legal fees as they work to secure their rights. The initiative came after many complaints were collected over the years by the “Battle Diamonds” forum, and cases were exposed in which attorneys charged enormous sums to eligible claimants, who paid out of the compensation, benefits, and rehabilitation funds intended for them.

The law sets out a detailed mechanism for limiting the legal fees that may be charged for handling claims for recognition, determining disability percentages, appeals, and other proceedings מול משרד הביטחון והביטוח הלאומי. Among other things, case-opening fees were capped at just 2,000 shekels. In addition, it was determined that in claims resulting in a disability ruling of 20% or more, the legal fee will be 16,000 shekels for 20% disability, with only an additional 800 shekels for each extra percentage point of disability.

The law also requires legal fee payments to be spread over at least 60 monthly installments, without interest or indexation, and it even allows retroactive reimbursement for those who paid above the caps set by the law under agreements signed since October 7, 2023. The restrictions will also apply to claims involving a worsening condition and derivative disability, to appeal proceedings, and to cases in which excessive payments were charged in the past.