Well I will say this thread has brought up quite a few interesting points. I will say that what Kate mentions, that domainers will be more reckless because they feel they have 'insurance' is a very good point. You need to be very careful with that...what if a domainer registered 500 trademark-infringing domains and gets cease and desist letters...you tell them to drop the domains...but what if the domainer turns around and says 'no, I paid you my subscription, you're my lawyer, I expect you to fight these'...even though they are clearly in the wrong. Then what?
That's indeed a problem, and to avoid such situations and naive customers, I'm working on comprehensive Terms of Service.
And as I read more and more of what you write, I wonder what type of legal system you deal with. You say how one bad transaction can send you to jail...I don't know where exactly you live, but here in the states, we don't have 'debtors prisons'...you can't be sent to jail just because you registered a domain...you would have to commit an actual criminal act in order to face jail in criminal court.
Also, your comparing it to health insurance is a little much. Here in the states, most people have health insurance either because their employer provides it or because they were required to buy a cheap policy through the marketplace. In either case, a normal healthy individual will have higher premiums over the course of the year then what they will actually spend on healthcare...if that weren't the case, then the insurance companies would go out of business. Regardless, health insurance is only really important if you have a surgery or other major health issues...similarly, domain lawyer insurance would only be helpful if you get sued by a major company who refuses to settle...and that is incredibly rare and almost a non-existent to a professional domainer who doesn't register trademarks. So comparing health insurance (where you can't predict if you will have an unforseen medical crisis) to domain insurance (where you can pretty well predict your risk of being sued) is ridiculous.
Well, I gave those examples to show that
unpredictable things happen. And if you read my statement, it says transaction, meaning any possible transaction. I think all of those who read this thread know about the situation with those 845 .in CVCV domains, and the reversed payment after selling 42 domains. Was it a transaction? Yes. Can that situation be considered Fraud? Yes.
Regarding the health insurance example, and because you say a domain problem can't be unforeseen, I will tell you a short story, a real UDRP case, won by a domainer with a lawyer on his side.
There was a guy, who got in the internet business around 15 years ago. He wanted to open an email service and offer custom email address on custom domains to his customers, so he registered around 3000 domains. Unfortunately, his email service hadn't enough demand, so he chose to list those domains at Sedo.
The second part, there is company on another continent, that got incorporated around 10 years ago and is using as it's name one of our guy's domain. Recently, this company approached this guy and made an offer, a low one... As our guy is in the domain business for long enough to understand the value of a domain when there is demand, he asked a higher price, that he considered is fair for his domain.
Company got crazy and filled a UDRP wanting to get the domain for free and screaming that our guy is a cybersquatter.
The panel was clever enough to check the backgrounds of the domain, WHOIS and history and find out that domain has been registered 5 years before the company's incorporation, and the higher price asked by owner can't be considered as bad faith.
So in the end, company lost the case, was found guilty of Reverse Domain Name Hijacking and I think lost any possibility to acquire that domain.
The moral of story? Domain industry can be unforeseen and naive people can cause a lot of problems. Never underestimate the greed and stupidity.
Reason I abandoned the idea was labor intensive as a low fee monthly model only works if you're just protecting clean low risk domainers. Same reason car insurance, home insurance etc... analyzes risk factors and adjusts pricing or drops things from protection. If your not pre-screening than basically a green light for the garbage to flow in and cause more headaches than it's worth and leave ya with a horrific UDRP record that won't instill confidence in anyone new buying into the plan.
I got some time to think about this issue, and decided to add a pair of additional services, prior to subscription, like portfolio screening and TM reviews.