Should You Fill Out a Financial Affidavit After a Car Accident?

Gideon Alper Uncategorized

Sometimes clients ask me whether they should fill out a financial affidavit after the injured person in a car accident requests the affidavit from the insurance company. This situation typically comes up when the client’s insurance company makes a settlement offer to the injured person, but the injured person (and their attorney) wants the financial affidavit completed before they decide whether to accept or reject the settlement offer made by your insurance company.

Often our clients balk at turning over all of that financial information and documents. First thing’s first: in Florida there is no law that says you must turn over the financial information. It is a request, not a requirement. But you should understand why the injured person’s attorney wants the information in the first place. From the injured person’s perspective, he or she wants to know what your financial condition is before deciding whether or not to accept your insurance company’s settlement offer. Should your assets and income be limited or otherwise not collectable, then the injured person is more likely to take the insurance company settlement. On the other hand, if the financial affidavit reveals significant exposed assets, then the injured person may decide to file a lawsuit against you instead of taking the settlement.

The answer for whether or not to fill out the financial affidavit after a car accident depends on your unique circumstances. Sometimes it makes more sense to review your asset protection situation, fix any issues, and then fill out the affidavit. Sometimes it makes sense to go ahead and fill out out. Or sometimes the best option is not to fill it out at all. Even if you do not fill out the affidavit, it does not necessarily mean that the injured person will file a lawsuit against you. Filing a lawsuit is expensive and time-consuming: it may not be worth it for the injured person even if they know nothing about your financial condition.

Typically the best course is to review your assets with an asset protection attorney to make sure you are not unnecessarily increasing the risk that the injured person as a judgment creditor can collect on your assets should he or she decide to file a lawsuit. Often there are ways to protect your assets first before getting to that stage. If there’s nothing that needs to be protected, then you can confidently fill out the affidavit under the logic that it could increase the chance of your insurance company reaching a settlement.

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