An Uninsured Contractor Got Hurt on My Property. What Now?

Little do homeowners know is that hiring an uninsured contractor to repair or upgrade their property comes with many risks that may offset the apparent savings one such deal usually comes with. Under premises liability laws, you risk shelling out tens of thousands of dollars if an uninsured contractor gets harmed on your premises. But if disaster strikes, learn what to do next.

Risks of Working with an Uninsured Contractor

Sure, those too-good-to-be-true quotes of an uninsured contractor may seem worth the risk; yet an insured general contractor will be able to cover every mishap happening on the worksite including injuries caused to subcontractors.

But when a contractor lacks liability insurance and/or worker’s comp coverage, you are on your own. Expect to pay thousands if not tens of thousands of dollars to cover the medical bills of injured workers, their lost income, and any damage to your neighbors’ property – all these expenses would have been covered by the contractor’s insurance carrier.

Your homeowners’ insurance does include personal liability coverage but in case of an accident, the coverage is either not sufficient or does not apply to contractors (who should be carrying separate coverage).

What is more, if you knowingly hired an uninsured contractor to work on your property, personal liability coverage will not kick in as most insurance carriers cover only the difference between the contractor’s minimum coverage and what you really need to pay if he gets hurt in an accident on your premises.

Also, if the uninsured contractor is a friend, that friend could sue you for compensation if he or she gets severely injured on your property and scrambles to pay all of the medical bills. So, always make sure from the get-go that contractors are licensed and have the proper insurance coverage in place.

An Uninsured Contractor Got Hurt on My Premises: What’s Next?

The bad news is that if an uninsured contractor gets injured on your premises, he or she can sue you for compensation under your home state’s premises liability rules. According to these rules, you have a reasonable duty of care to guests, contractors performing work on your home, and, in a few states, even trespassers.

Under the law, you are required to offer a safe working environment to any contractor working on your property. You also have the legal duty to warn contractors of any hazardous conditions on your premises that might get them hurt, especially when those conditions are not obvious. If you fail to do so, you can be sued for damages if the contractor gets hurt.

But if the (sub)contractor has general liability insurance and/or worker’s comp coverage, his insurance carrier will cover the resulting medical bills, lost income due to injury, and other out-of-pocket expenses if an accident occurs.

However, a contractor’s insurer may reject his injury claim when if he has the proper coverage. Especially subcontractors protected under worker’s comp rules have a hard time recovering damages and might sue you instead. If that happens, refer them to an experienced professional like a workers compensation attorney from John Foy to get them off your back.

In case of an accident, your insurer may cover the difference when the injured contractor’s insurance limits are exceeded. But homeowner’s insurance does not always cover contractors’ injuries due to homeowners’ negligence or carelessness (make sure that you read the fine print beforehand). Also, homeowner liability rules vary (greatly) from state to state.

So, if an uninsured contractor or subcontractor gets injured on your property, you may be liable for his injuries. However, there is hope. Check whether your homeowner’s insurance policy’s personal liability coverage applies to a contractor’s injuries.

If it does apply but those insurance limits are also exceeded, you may get sued for the difference. This often happens when medical bills pile up excessively. If you get sued, the next step is to lawyer up, but seek a professional in your area with an excellent track record in handling premises liability injury cases.