Different Claims in Estate and Business Planning

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One of the big concerns with many people is how to protect their estate and business assets from claims from third parties, which includes personal injury claims. For business owners especially, they do not want to have their personal home at risk from an accident caused by an employee.  What concerns them, really, is that a jury will provide damages in excess of the injury coverage due to an employee’s mistake, despite the owners’ best efforts to prevent injuries, etc.

What Kinds of Claims Exist?

Claims can exist on a variety of fronts.  These include such mundane things as creditor claims. Creditors will try and reach through and claim personal assets if they cannot get paid through the earnings of a person. For many business owners, they do not have any regular cash flow, such as a paycheck.  Instead, they can time any distributions to their desires and also to the place that they want. So, creditors will look to assets to provide payback for those claims.

What about Personal Injury Claims?

Most personal injury claims are paid through insurance. If you talk to your local personal injury, one of the first questions that they are likely to ask is about insurance as it is the easiest, best way to obtain funds for a person’s injuries.  However, business owners have to face additional worries from personal injury claims.  This is true even if the business owner was not involved in the actual accident.  Instead, as the owner of the business where an employee causes an accident, they are potentially liable for the actions of those employees. So, a negligent employee can have an auto accident and the owner could be on the hook for those damages, which could be concerning if there is not enough insurance to cover the total cost of the potential damages.

One example is where an employee got drunk and took the company truck and plowed it into a minivan, killing the mother and seriously damaging three children. The jury was outraged at the behavior of the employee and found for the plaintiff to the tune of several million dollars. The owner of the business had a million dollar policy, but it was inadequate to pay for all the damages.  However, because the employee was on company time and driving a company truck, the owner was still liable.

What about Claims from Children?

Sometimes, there are claims that arise from children, as a skilled estate planning lawyer Leawood KS trusts can explain. These can be both direct claims and indirect claims.  A direct claim is where a child actually stakes a claim in the assets themselves. For example, a child could claim that they were promised a piece of property and ask to take that property immediately. These claims are fairly common in second spouse situations – a great example is the Tom Benson saga (he’s the owner of the New Orleans Saints and his family is in an ugly legal battle).

More commonly, there are indirect claims from children.  These claims can come from creditors, such as a medical claim. What happens is that the child has a medical issue that exceeds their ability to pay.  Then the creditor looks to other assets, which could include any beneficiary rights to assets of the parent.

Another common claim from a child is from an ex-spouse.  These claims can be substantial in their depth and scope of claim, depending on the amount given from the divorce decree as well as any child maintenance amounts.


There are a variety of ways that a creditor can lay a claim to assets.  These things include personal injury claims, standard creditor claims, and creditor claims from a child.

The Eastman Law FirmThanks to our friends and contributors from  The Eastman Law Firm for their insight into estate planning practice.