Do I need to protect my savings and investments before being sued?
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Do I need to protect my savings and investments before being sued?
My wife was in an accident with motorcyclist. The medical bills are more than my insurance coverage. The insurance company says I may be responsible for the rest. Do I need to take steps now to protect my life savings and a home my mother lives in that’s in my name?
Asked on October 21, 2019 under Accident Law, Texas
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 5 years ago | Contributor
It's probably too late to take steps to protect these assets, unfortunately. Every state has passed a version of the "Uniform Fraudulent Transfers Act." This set of laws says that if you know or suspect (i.e. have reason to believe) that you will be sued or owed someone money, any transactions or transfers you make which are not for "fair market value" (i.e. selling something for what it is actually then worth) are fraudulent and can be voided or set aside by the creditor or plaintiff, so they can get at the money or asset. So if you, for example, try to put the house in someone else's name or into a trust, that transfer can be undone unless the person or trust acquiring it paid you the current fair market value for the home. Asset protection has to be done in advance, before you think you will need it.
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