Time to Review the Auto Insurance Policy

Imagine this scenario: You are a single mom working to make ends meet and you have an auto accident. Unfortunately, it’s your fault. You are cited for taking the right of way from a motorcycle rider and the motorcyclist loses his leg as a result of the accident. You have modest equity in your home, a modest 401-k and a small amount of savings.

In Colorado, this woman happened to have bodily injury coverage of $100,000…She is already past the limit of coverage and now the motorcyclists attorney are pursuing all her assets-this is an ugly situation. It was also the topic of conversation for my Friday night dinner pals. This woman works with them. One of them suggested she immediately put everything in a living trust to protect what little assets she had. The truth is, it’s too late for that.

Here are some thoughts on why you may want to check with your insurance agent and attorney regardless of your age and net income:

1. Ask your insurance agent to look at “umbrella” coverage for your home, auto etc. You can often get a million dollars of additional coverage for very little money.
2. Speak to an attorney on the merits of putting your assets in a living trust. These are not just for individuals worth $5 million-they can provide many benefits for all of us.
3. Don’t forget to cover with your attorney all those other little things like medical directives, wills etc…

Unfortunately, this story is not going to have a happy ending for this hard working, single mother but hopefully some good can come out of this by sharing her story with you.

Steve Mertz
I’m not an attorney!

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