Asset Protection: Keeping Your Wealth Safe from Lawsuits
Asset Protection Matters
If you work in construction, you already know the risks. Jobsite injuries, contract disputes, property damage claims, and vehicle accidents are part of the industry. Even when you do everything right, a lawsuit can still land on your desk.
Here’s the hard truth: one serious claim can wipe out years of hard work.
The good news? With smart planning, you can protect what you’ve built.
KEY IDEA: Asset protection is not about hiding assets — it’s about protecting what you’ve earned using legal structures and smart planning.
Why Contractors Are Frequent Lawsuit Targets
Construction businesses face higher legal exposure than most industries. Common claims include:
· Jobsite injuries
· Property damage
· Construction defects
· Contract disputes
· OSHA violations
· Vehicle accidents
· Personal injury claims
Even a small claim can cost thousands. A major injury claim can exceed insurance limits and put your personal assets at risk.
Step 1: Separate Personal and Business Assets
Operating as a sole proprietor means you are the business. If the business is sued, your personal assets may be exposed.
Forming an LLC or corporation creates a liability shield — but only if you respect it.
· Maintain separate bank accounts
· Use separate credit cards
· Sign contracts in the company name
· Keep accurate bookkeeping
· Never mix personal and business funds
WARNING: Mixing personal and business finances can allow a court to pierce the corporate veil.
Step 2: Carry the Right Insurance (and Enough of It)
Insurance is your first line of defense. Contractors should review:
· General liability insurance
· Workers’ compensation coverage
· Commercial auto coverage
· Builder’s risk policies
· Professional liability (if design/build work is involved)
· Umbrella liability coverage
A $1 million policy may sound like a lot — until a serious injury claim exceeds it. Umbrella policies are often affordable and provide critical extra protection.
Step 3: Protect Assets You’ve Already Built
As your business grows, protecting your personal wealth becomes critical.
· Holding companies or separate LLCs for real estate and equipment
· Using Utah homestead protections to safeguard home equity
· Maximizing protected retirement accounts
· Proper titling of property and assets
Step 4: Use Strong Contracts and Risk Controls
Asset protection is not only about entities and insurance. Prevention matters.
· Limit liability exposure
· Require subcontractor indemnification
· Clarify scope of work
· Reduce payment disputes
· Allow recovery of attorney fees
BEST PROTECTION: The strongest lawsuit defense is preventing claims before they arise.
Step 5: Plan Before Trouble Starts
Asset protection works best before a claim arises. Moving assets after a lawsuit begins can create legal problems and may be reversed by a court.
Protect What You’ve Built
You didn’t build your business just to lose it to one bad claim. With the right structure, insurance, and planning, you can protect your family, your assets, and your future.
READY TO PROTECT YOUR BUSINESS? A proactive legal review can identify gaps and help you build a protection strategy tailored to your construction business.
Contact Irvine Legal today to schedule an asset protection review and make sure everything you’ve worked for stays protected.
Legal Disclaimer
This article is provided for informational purposes only and does not constitute legal advice. Reading this material does not create an attorney-client relationship. Asset protection strategies must be tailored to individual circumstances and implemented in compliance with Utah law and federal regulations. Consult qualified legal counsel before making legal or financial decisions.