In the last few years, I have been approached on more than
one occasion by individuals that had been sued, and were
extremely concerned that their hard-earned assets could be
exposed and subject to collection on a judgment.
Unfortunately, I was compelled to tell some of these people
that, in fact, their home and bank accounts were exposed.

And that's wasn't even the worst part; in nearly all of
these cases, this terrible circumstance - where these
people's hard-earned money was subject to being lost - was
entirely preventable. In order to help assure that other
hard-working people don't fall prey to this problem, I have
compiled the following list of short-sighted acts that
could land someone in the same unfortunate situation:

Mistake #1 - You Fail to Timely Notify Your Insurer That
You Have Been Sued

Nearly all insurance policies require you to inform the
company of a lawsuit, or even an anticipated claim, "as
soon as practicable." The courts have generally
interpreted this provision as requiring that the insurer be
given written notice of the claim within 30 days;
otherwise, the insurer may rightfully deny your claim. In
order to best protect your interests, I suggest that you
forward the insurer a copy of the suit papers both by fax
(so you have a fax confirmation sheet) and by certified
mail, return receipt requested to head off any claim by the
insurer that they did not receive timely notice of the
claim.

Mistake #2 - You Fail to Procure Enough Insurance to
Protect Your Assets

For a difference of roughly $100-$200 a year, you can
probably get an additional $200,000 worth of liability
insurance; for roughly $300 a year, you can get a $1
million umbrella policy. Very often, people look to save a
few dollars on their insurance, and purchase minimum
policies that leave their assets, such as their home and
bank accounts exposed. This is pure madness. Simply put, at
these low prices, you cannot afford not to purchase this
additional insurance.

Mistake #3 - "Since this Case is Frivolous, I Will Just
Ignore it and it Will Go Away."

Ignoring the lawsuit will not make it go away - it will
only make it far worse. You may not want to spend the
money to hire a lawyer to defend your interests (again,
this assumes that your insurer is not defending you), but
if you don't, you will end up with a default judgment
against you that prevents you from demonstrating that this
claim is meritless. Further, you may end up with a judgment
that clouds the title to your home, shows up on your credit
reports, and the sheriff may levy on your bank accounts.

Don't be foolish; if you've been sued contact a lawyer that
is experienced in the appropriate field - and do it
immediately. In this manner, you will be going a long way
to assuring that your assets are not needlessly placed at
risk.


About the Author:

Jonathan Cooper is an attorney in private practice. He
represents small businesses and individuals in New York's
trial and appellate courts. For more information on his
firm, please visit http://www.jmcooperlaw.com