Financial affidavit after a car accident

Financial Affidavit for a Florida Car Accident

After a car accident, the injured person’s attorney will often request that the at-fault party complete a personal financial affidavit or an affidavit of no other insurance or assets. The liable party can be the at-fault driver or even the owner of the vehicle that the at-fault driver was driving with permission.

A financial affidavit provides the injured person’s attorney with financial information about liable parties. The attorney uses the affidavit to decide whether their client should reject insurance settlement offers and file a lawsuit to recover damages for the injured client.

Quick Summary

  • Florida law does not require you to fill out the financial affidavit.
  • Filling out the affidavit can sometimes lead to a quicker settlement.
  • Most car accident cases will settle within your insurance policy limit.

Is Submitting a Financial Affidavit Required After a Car Accident?

Florida law does not require you to submit a financial affidavit after a car accident.

You alone can decide whether to submit an affidavit or not.

The injured party’s insurance company has good reasons for requesting that you, the party liable, provide a financial affidavit or an affidavit of no other insurance. An injured party who suffers medical and other damages due to a car accident has a choice about how they can recover compensation for their damages. They must decide whether your personal wealth is a better target than an immediate cash offer from your insurance company.

We help clients throughout Florida.

We offer customized advice about specific steps to better protect your assets from creditors. Our consultations are offered remotely by phone or Zoom.

Alper Law attorneys

What Happens After a Car Accident

The injured party could accept whatever insurance money your insurance company offers. If the injured party accepts the insurance payment, they will release you (the at-fault party) and your insurance carrier from all claims. Their alternative is to decline your insurance money and instead pursue a civil judgment against you. The injured party cannot both accept an insurance settlement and sue you personally for damages.

If the injured party declines insurance and sues you personally, they risk losing the case. It is possible they cannot convince a jury of your liability or the amount of their claimed damages. If the injured party sues and receives a favorable jury verdict, they will be awarded a money judgment for the amount of proven damages. The plaintiff must then collect the judgment from your personal assets. Your personal assets may be exempt from collection.

The plaintiff cannot collect all or any part of a money judgment from your exempt assets, such as your Florida homestead, retirement funds, annuities, etc. But, the plaintiff can take from you any non-exempt assets such as money in an individually owned bank account, your automobiles, or your business.

The injured party wants your financial affidavit to assess the likelihood of recovering damages from your personal assets in lieu of an insurance settlement. Suppose your financial statement does not show significant amounts of collectable, non-exempt assets. In that case, the injured party will likely accept an insurance settlement and release you from any further personal liability. The affidavit showing a low amount of non-exempt assets will expedite a settlement.

If your financial statement shows that you own many non-exempt, collectable assets, and your insurance liability limit does not cover the accident damages, the injured party is more likely to reject the insurance settlement and sue you personally.

Should You Fill Out the Financial Affidavit?

Whether or not you should fill out the financial affidavit after a car accident in Florida depends on your unique circumstances and your defense strategy.

Wealthy individuals who are “deep pocket” defendants have little to gain by furnishing a plaintiff’s attorney with a financial statement. The financial affidavit will increase the chances of a personal lawsuit to recover the plaintiff’s damages and provide the plaintiff’s attorney with a road map to collect a money judgment.

On the other hand, voluntarily submitting a financial affidavit carries little risk for someone who owns primarily exempt assets. An example is a retired person living on social security and retirement accounts whose income is exempt from lawsuit collection. Demonstrating that most income is exempt from creditors should convince the injured party to accept an insurance payout.

Exempt Assets

Most people are unsure whether their assets are exempt from collection or whether they are an attractive lawsuit target. Most car accident defendants would benefit from an asset protection review. If an asset protection review finds that you own significant non-exempt assets that are exposed to the injured party, you may consider legal steps to better protect these assets before submitting a financial affidavit.

There are asset protection strategies available even after a car accident that are not reversible as fraudulent transfers or fraudulent conversions. The financial affidavit is a static picture of your financial situation. An affidavit will reflect your personal finances after you have implemented asset protection tools. Effective asset protection prior to signing the affidavit will make it more likely that an injured party will not sue you for damages.

Gideon Alper

About the Author

I’m an attorney who specializes in asset protection planning. I graduated with honors from Emory University Law School and have been practicing law for almost 15 years.

I have helped thousands of clients protect their assets from creditors. Before private practice, I represented the federal government while working for the IRS Office of Chief Counsel.