How do I protect my assets from lawsuits? Well, your biggest exposure for liability and being sued is with your automobile. So whatever automobile you drive, you should be shown as the owner, and don’t hold the title in your joint names because the automobile is a dangerous instrumentality, and if it’s involved in an automobile accident, the owner or owners as well as the operator or driver of the vehicle who caused the accident has liability. So if you have more than one automobile in your family, have each spouse put the automobile which they drive in their name so that they’re the owner and operator, and that way if either of you are involved in an accident, well, then they can only sue one spouse.
I also suggest that you talk to your insurance agent about getting what they call an umbrella policy. Umbrella policy offers you protection for liability that exceeds your insurance limits. Hopefully you have $100,000.00 limits, and if you’re concerned about exposure over $100,000.00, you can get what they call a $1 million umbrella, or $2 million, and that way the umbrella policy covers any damages above the $100,000.00 limit. So depending on how much security you want is how much you should cover as far as a liability policy. And it covers not only liability for automobile accidents, but anything you would be sued upon, or most things you would be sued upon.
Be sure to include that as uninsured or underinsured motorist coverage. In these recessionary times, you have any number of people out there driving, and they may not have any insurance. And if they cause an accident and you’re injured, well, you don’t have anyone to turn to, and if you don’t have underinsured motorist, well, then you don’t have anyone to recover your damages from, whereas if you do have underinsured motorist on an umbrella policy, well, you’re covered for the extent of your insurance coverage.
As far as a title to your assets, I suggest that you place them if you’re married in your name as husband and wife for tenancy by the entirety, and that way, if there is a judgment as a result of an automobile accident, they cannot reach any of your assets that you have titled as husband and wife or tenancy by the entireties.
So if you want to do some asset protection and discuss your estate plan, well, give me a call at 727-847-2288.