This question is like asking, “Should my baby get vaccinated?” Sure, the chance of getting polio in the U.S. is now quite low (due to the push in years past to vaccinate all children). But … if your child is unlucky enough to get polio, he or she could end up in a wheelchair for life.
In terms of asset protection, the risk we’re talking about is losing your life savings due to a lawsuit. There is no universal rule. For example, if you reside in Florida, your house is protected from bankruptcy. And perhaps all of your investments are in IRAs (which are also protected in bankruptcy). And perhaps you don’t own a car, and live off a trust set up for you by a wealthy relative. Then you are probably pretty safe from being sued. But otherwise, you may be at risk.
How could you be sued? Here are some common ways:
- Causing an auto accident.
- Having a worker get injured while on your property.
- Having a visitor get injured on your property.
- Being accused of libel, slander, or invasion of privacy.
- Being accused of sexual harassment, discrimination, abuse, or wrongful termination by an employee.
- If you are a professional (doctor, lawyer, dentist, etc.), being sued by a client or patient for malpractice.
While most people understand the types of risk, most people completely underestimate the degree of risk. Here are some examples of recent court verdicts and settlements that indicate the possible cost of losing a lawsuit:
- A $49 million verdict in California resulting from a multi-vehicle crash in which a 21-year-old college student was left in a coma for one month and expected to require lifetime 24-hour care;
- A $31 million verdict in California to two defendants who were swept off a boat and subsequently injured by its propellers;
- A $29 million verdict in Pennsylvania for a four-year-old boy who suffered a debilitating spinal cord injury while riding as a passenger in a vehicle involved in a head-on collision;
- A $21 million wrongful death action involving a 21-year-old female college student killed in an auto accident in Texas;
- A $20 million award in Florida for the death of a teenage male riding an ATV on a neighbor’s property without proper supervision;
- A $19 million award in New Jersey to a pedestrian suffering mild brain injuries and permanent scarring after being struck by a vehicle;
- A $14 million wrongful death verdict in Illinois involving a 22-year-old killed in an auto accident.
People who need an asset protection plan include:
- Doctors,
- Lawyers,
- Business owners,
- Real estate developers,
- Other highly paid professionals.
I’ll get more into the details of asset protection in future blogs. In the meanwhile, if you have questions you can reach me at 602-443-4888.
This blog was intended as a general introduction to asset protection. Your specific situation is unique, this blog post is not legal advice. This blog does not create an attorney-client relationship. Feel free to contact Paul Deloughery at 602-443-4888 if you have any questions. Mr. Deloughery is admitted to practice law in Arizona.
Paul Deloughery is an estate and probate litigation, and law insurance dispute consultant in Scottsdale, Arizona. Visit his website to read more of his blogs or follow him on Twitter!