That’s an excellent question. Let’s put it in perspective. Liability insurance is important, but liability insurance can’t replace the other ways to protect yourself. Liability insurance ensures only one in three lawsuits. So most lawsuits aren’t covered. For example, you may be sued for breach of contract, a defaulted loan, or family dispute. The possibilities of an uninsured claim are endless. Nor does insurance fully cover every claim. How good is your million-dollar liability policy if you’re sued for two million? And with today’s unpredictable, ludicrous jury awards, who can be certain they won’t be hit with an excessive judgment? Nor can you overlook those countless policy exclusions and loopholes. You can’t even be certain that your insurance company will be in business when you’re hit with a claim? Insurance companies – like other companies – do go bankrupt. We strongly recommend buying liability insurance. It’s a smart first step for protection and risk management. Also buy as much liability insurance as you can reasonably afford. But make liability insurance only your starting point. It can’t replace a solid asset protection plan that will fully protect you against every size and type claim.
If I have liability insurance, do I still need an asset protection plan?