BROWSE

Dangerous Asset

What is 'Dangerous Asset'

An asset which, by its nature, creates a substantial risk of liability to the asset owner. Dangerous assets include commercial real estate, motor vehicles and construction equipment.

Risk of personal injury and/or property damage is higher with dangerous assets. For example, a truck, by its mere use, has the potential to cause physical harm to its occupant as well as bystanders.

Explaining 'Dangerous Asset'

Because dangerous assets carry with them a greater risk of liability for personal injuries and property damage, for asset-protection purposes a single business entity should not own more than one dangerous asset. In addition, dangerous assets should not be commingled with safe assets.

For example, if your limited liability company (LLC) owns your commercial real estate as well as your company's bank accounts, a person who is injured while on the property could sue the LLC and not only pursue the property to satisfy his/her claim, but the business bank accounts as well.

Often, it's best to place a dangerous asset, such as your business property, in a separate entity, such as a real estate trust, with your safe assets held in a family limited partnership (FLP) or LLC.


Further Reading


Financial consolidation: Dangers and opportunities
www.sciencedirect.com [PDF]
… The presence of larger institutions presents a danger to the safety and soundness of the … total elimination of the safety net would be a radical step that could be extremely dangerous … The basic theme of this paper is that financial consolidation raises some dangers because the …

Monetary Policy and Financial Assets Price <span style=[J]' src='/thumbnails/?img=http%3A%2F%2Fen.cnki.com.cn%2FArticle_en%2FCJFDTotal-JJYJ200203001.htm' />Monetary Policy and Financial Assets Price [J]
en.cnki.com.cn [[J]' href='https:/api.miniature.io/pdf?url=en.cnki.com.cn%2FArticle_en%2FCJFDTotal-JJYJ200203001.htm'>PDF]
… The presence of larger institutions presents a danger to the safety and soundness of the … total elimination of the safety net would be a radical step that could be extremely dangerous … The basic theme of this paper is that financial consolidation raises some dangers because the …

Financial–real-side interactions in an extended monetary circuit with shadow banking: Loving or dangerous hugs?Financial–real-side interactions in an extended monetary circuit with shadow banking: Loving or dangerous hugs?
www.tandfonline.com [PDF]
… The presence of larger institutions presents a danger to the safety and soundness of the … total elimination of the safety net would be a radical step that could be extremely dangerous … The basic theme of this paper is that financial consolidation raises some dangers because the …

Confronting Financial Crisis: Dodd-Frank's Dangers and the Case for a Systemic Emergency Insurance FundConfronting Financial Crisis: Dodd-Frank's Dangers and the Case for a Systemic Emergency Insurance Fund
heinonline.org [PDF]
… The presence of larger institutions presents a danger to the safety and soundness of the … total elimination of the safety net would be a radical step that could be extremely dangerous … The basic theme of this paper is that financial consolidation raises some dangers because the …

Financial derivatives: Harnessing the benefits and containing the dangersFinancial derivatives: Harnessing the benefits and containing the dangers
papers.ssrn.com [PDF]
… The presence of larger institutions presents a danger to the safety and soundness of the … total elimination of the safety net would be a radical step that could be extremely dangerous … The basic theme of this paper is that financial consolidation raises some dangers because the …


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