Top 5 Fundamentals for Asset Protection: Part 2
Asset Protection, Part 2
I am often asked for legal advice on asset protection topics. Though there are myriads of ways to protect assets, in this series of articles I am discussing my “Top 5 Fundamentals for Asset Protection”. Most of these topics fit for people who have some assets, but some topics fit everyone, yes even the person who owns nothing. What does that person have to protect? Wages. We do not need to spend money on every form of asset protection. Some of the suggestions in this series are free or nearly free.
Part 1 discusses acting in an ethical and conscientious manner.
Protecting Assets With Insurance
Part 2 covers insurance, one of the more expensive components of an asset protection strategy. If you drive in the State of Utah, you need insurance already. What most people don’t know is what coverage they need and what insurance company from which to obtain a policy.
The State Minimum is Not Enough
Starting with the coverage, any coverage helps, but some coverage limits help more than others. Take driving for instance. The State of Utah requires all drivers to maintain coverage of at least $25,000. In 2016, both Kelly Blue Book and USA Today indicated the average price of a new car is somewhere in the mid thirty thousand dollar range. Coverage of only $25,000 will not cover hitting an average new car. I dread to think what hitting some luxury or high performance car would cost. Maintaining the minimum coverage is simply not enough for a good asset protection strategy.
How Much Insurance Do I Need?
Simply maintaining enough insurance to cover the other party’s car is not enough. Injuries really increase the bill. Personal injury awards or settlements may vary greatly depending upon the injuries involved. Whatever the personal injury amount may be, the state minimum of $25,000 may not cover it. Based upon anecdotal evidence from personal injury attorneys, it may be wise to have around a $1,000,000 in coverage. Injuries costing more than $1,000,000 are fairly rare. Everyone’s situation is different, but more coverage is usually better than less. Talk to your attorney and insurance advisers to determine what is the best coverage for you and your asset protection needs.
Where Should I Get Insurance?
Find a good insurance company. The point of insurance is to spread out between yourself and others the risk of catastrophic events which could quickly deplete your assets. Any insurance company you select should have reasonably strong financials. Because of the heavily regulations imposed upon insurance companies most insurance companies in the US will be fine. Your most difficult task will be selecting a company that pays claims well and quickly. Many companies, especially those that advertise discount rates will fight their own customers when a claim is made. To find the good insurance companies in your area, spend some time talking to insurance agents and personal injury lawyers about their good and bad experiences. Don’t rely exclusively on close friends and neighbors who only made one or two claims in their lifetime.
To conclude with Part 2, protect your assets and insure yourself well. Get good coverage limits. Find good companies. Do your research.