When you are facing a lawsuit, one of the things you will worry about is how much you will lose. The legal process of personal injury lawsuits comes with graver consequences than you can imagine. You risk losing everything from wages and bank accounts to vehicles and real estate.
Therefore, if you are involved in a personal injury lawsuit, you should liaise with your lawyer. Know what the laws governing personal injury lawsuits in your state protect. This article will examine all the assets and properties protected by personal injury law.
Your Home
You can have a homestead exemption, which prevents creditors from seizing your home to recover what you owe them. However, this will only work if your home equity exceeds the exemption amount. Otherwise, a creditor may force a sale after attaching a judgment lien to the property.
Once they have succeeded in selling your house, the creditor will remove the amount of money needed to cover the debt. If there is any surplus equity, they will give it to you.
Federal and State Benefits
The law typically protects benefits paid through direct deposit from the collection due to lawsuits. These benefits include Social Security or Veterans Administration benefits.
Retirement Assets
Your retirement assets may also be protected only in a pension or retirement plan governed by federal law. The federal law covers pension plans and 401(k), although IRAs may have varying protection levels. The law may also protect all or at least some of the cash value of a life insurance policy.
Basic Deposit Account Balances, Income
Your state’s laws may protect you from complete destitution. They may also prevent creditors from seizing a certain amount of your bank account balance. Federal law may protect some of your wages from creditors, but state laws are usually more protective in this sense.
Your Vehicle
Personal injury law may also protect your basic transportation from being taken away. For instance, you may be able to retain your vehicle if it is less than a stipulated amount. This rule also applies to your clothing, household furnishings, appliances, and items you need to earn a living.
How to Protect Your Assets Before You Get Sued
No one ever plans to get sued, but the unexpected can happen, which is why you must prepare. For instance, you could be involved in a car accident, or your dog may bite a passerby. Unforeseen circumstances, such as an old tree from your property falling on and damaging your neighbor’s roof, can happen.
As such, you need to take some preventive actions before these situations can render you bankrupt. Also, it has to be before they happen because trying to quickly get rid of assets after being sued is considered fraudulent. Below are ways you can protect your assets now while there is no personal injury lawsuit staring you in the face:
- Get yourself a homeowner’s insurance policy that comes with a high liability limit
- Get your assets placed in irrevocable trusts
- Have an umbrella insurance policy for higher liability protection
- Buy liability car insurance
- Ensure you have a business insurance policy as a business owner
Conclusion
No one desires or plans to be involved in a personal injury lawsuit, but anything can happen. Before it does, you must protect your money and assets to avoid losing everything. “Hiring a competent personal injury lawyer may be able to assist you or your loved one in a personal injury lawsuit,” says attorney Jan Dils of Jan Dils, Attorneys at Law.
However, if you still get sued despite all possible protections, let your insurance help you get the best possible attorney. If your insurance does not cover the suit, obtain a lawyer knowledgeable about the type of dispute you are facing.
