There was a time when people considered a car accident to be a mistake, and something that needed to be dealt with quickly by repairing the damage. Things are much different now, and others may see your unhappiness as their benefit. This is especially true if you have assets such as money or assets. If you have a car accident, your property is definitely at risk.
There’s an error
Just because you’re in a car accident doesn’t mean you’re going to lose your property to others. You must be held accountable, otherwise the accident that occurs must be your fault. Police officers at the scene did not say who was at fault. Finally, liability is determined in court or by insurance companies that are involved with the driver if they reach an agreement. Sometimes, the error is obvious, but the law does not define liability, as it is a civil matter. If you are sued, you will need to defend yourself, otherwise the court will assume you are at fault and can make a ruling to the other party.
Some assets that you may own cannot be sued. Most often, retirement assets held in an employer-sponsored retirement plan may not be used to satisfy a lawsuit. The employer-sponsored plan includes a 401k or 403b plan. These plans are protected from lawsuits under federal law. In addition, some states may allow similar protections for assets held in a Personal Retirement Account (IRAs). If a lawsuit over a car accident leads to a cut in your salary or bank account, then your disability or any other federal benefits cannot be cut.
If you own property, primarily a home, and your state provides extensive exemptions on housing in the event of bankruptcy, you can quash your judgment by filing for bankruptcy. All non-exempt properties will be used to settle a bankrupt person’s bills, but he will be able to keep the assets exempt, such as a large amount of home equity if any, while the plaintiff in the auto accident lawsuit must stand in line with the others. IRA accounts are also protected for up to $1 million in the event of bankruptcy. If an accident stems from drunk driving, or may be due to other forms of negligence, then the sentence will not be resolved in bankruptcy, and it must be paid.
- Advertisement -
A driver needs to protect his or her personal property. Almost all states require drivers to purchase very low levels of liability insurance. Any driver should carry automotive liability insurance of at least up to his or her net worth. Depending on the case, the driver can carry more may be a good idea. If she can’t afford enough auto liability insurance for her needs, she can buy auto liability insurance for a higher amount. You can buy umbrellas covering up to $1 million for between $200 and $300 per year.