Insurance policies are like the pawns on the chessboard of your asset protection strategy. They provide an essential line of defense, but they cannot protect your assets alone.

When you play chess, pawns provide a first line of defense and support your more powerful players, like the Queen and the Rook. But pawns are vulnerable and easily defeated. Insurance policies are the pawns in your asset protection strategy. They provide an essential first line of defense, but they rarely prevail alone. Exclusions are the first weaknesses of your policies. Read your insurance policies carefully to see what claims they exclude or will not cover. Policy limits are the second weakness of insurance policies. A policy may have, for example, a limit of $2 million. If a potential creditor knows that you have much more than $2 million worth of assets vulnerable to being seized, then the creditor will not settle for the policy limits. But if you have more powerful asset protection structures that make your assets difficult to find or reach, then the creditor will be more likely to settle for insurance limits. The pawn of insurance is essential, but it won’t protect your assets alone.