You may answer this question by insisting that the Association is not an employer and therefore does not need to have such insurance coverage. This begs the following question: What about the handyman that the Association uses from time to time? Is he an independent contractor or is he an employee or both? Well, he is certainly not an employee in the true sense of the word, as he is not on payroll and only works at the property on an as needed basis. One would reasonably presume that he is an independent contractor, and not an employee, and as a result no workers’ compensation insurance coverage is needed.


Let’s say that the Association hires a contractor, whether it be a handyman, a painter, a roofer or any contractor for that matter. The contractor represents that he has workers’ compensation insurance in force and may very well have presented the Association with a certificate of coverage, but for some reason or other, the contractor’s coverage is no longer in force and he does some work at the Association and gets injured while doing it. The Association now becomes the employer as far as that injury is concerned, which means that the association can be liable for any and all medical bills and loss of earnings for that particular contractor. What if the injury is of a serious nature? The medical bills and loss of earnings can run into hundreds of thousands of dollars. So called “handymen” may present a big problem as they rarely maintain their own workers’ compensation insurance and are often unlicensed. Therefore, when a handyman steps onto association property is unlicensed and does not have workers’ compensation insurance, that handyman is deemed to be an Association employee. Please be aware that General Liability policies and D & O (Directors’& Officers) policies generally will not cover work related injuries. So how does an Association protect itself? The Association must purchase what is known as a “none payroll” workers compensation policy, which will protect the Association from a claim by an uninsured contractor who gets injured while working on Association common area property. A policy of this nature costs approximately $500 per year, which is a minimal amount to spend for the protection afforded by such a policy.

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