What are the Risks & Liabilities of Homeowners Failing to Ensure the Contractor they Hire Carries Workers’ Compensation Insurance? 

Michigan law requires that every employer subject to the Act/Law must carry workers’ compensation insurance if they employ 1 or more employees for more that 35 hours per week for 13 weeks or longer during the preceding 52 weeks. In addition, all private employers regularly employing 3 or more employees at one time or the employees of a sole proprietorship.


Sadly, most roofers fail to carry workers’ compensation insurance because of the significant costs which in Michigan were $40,980 per $100,000 in payroll expenses. That $40,980 is easily the third highest expense for a roofing contractor after material costs and direct labor payments.


Most homeowners fail to check a contractors insurance records or even ask for a copy of them when almost any list of questions to ask a contractor before hiring them are free and readily available from on-line consumer protection agencies such as the Better Business Bureau.


Many roofers will falsely claim they are fully insured when in fact they are not. Most will carry some liability insurance but almost all will violate State laws and not carry workers’ compensation insurance putting the homeowner in legal jeopardy if a worker gets injured while working on the home or in some cases the actual injury occurs at another property owners home only to have the worker claim they were injured at your home.


$63,318.86 was the average workers compensation settlement according to the Michigan Disability Compensation Agency in 2021.


There are severe penalties for the failure of an employer to carry workers’ compensation coverage. If a worker is injured, he or she may sue the employer for damages in the civil court system and many homeowners get caught up in this litigation. The employer is also subject to a fine of $1,000 or imprisonment for no less than 30 days.


Hiring a contract without workers compensation insurance could leave you paying an injured employee or subcontractor’s medical bills indefinitely, just for hiring someone to fix your property.

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