Legal Question in Insurance Law in New York

Re: Posible Lawsuit

They certainly can sue. They might not win, but they can sue. The statute of limitations for negligently-caused personal injury is three years. The results may be unexpectedly expensive for you.

I'm guessing that you did not notify your insurance carrier about the occurrence within a day or two after it happened. There is the problem. Your insurance policy (you have a homeowner's policy, right?) contains a policy condition requiring you to give notice of occurrences that are likely to give rise to a claim "as soon as practicable." You are now in a fix. Your position will be that you had no idea that a claim would arise from the occurrence and therefore you acted reasonably in not giving notice of the occurrence.

Now, it sounds like you do have notice that a claim is likely. And in all likelihood, when you give notice of the occurrence at this point, you will receive back a "reservation of right" letter from the carrier, which will investigate the matter and likely torment you more. If the carrier does not disclaim within a reasonable time after you give notice of the occurrence and possible claim, then you will be home free. But I would not count on that. The most likely outcome is that the carrier will demand an examination under oath of you (and your spouse if the house is jointly owned) as a preliminary to disclaiming. They may also increase your premium based on "experience rating."

Bottom line: you have a problem. You should retain counsel. Soon, because you need to make a decision right now about how to handle your problem with the insurance carrier.

Re: Posible Lawsuit

They can and they should! There is no reason why you should try to save your insurance company money. You have paid insurance premiums for this very reason. Obviously, if this is someone who you had invited to your home, that person is a friend or relative. You should immediately notify your insurance company of the possibility of a claim letting them know you have just been notified (there are time limits in your insurance policy). You should let the person who was hurt know who your insurance Company is. By the way, the premiums for homeowner's insurance policies do not increase because of the event because, if they do, you can simply go to another insurance company that will charge you a lower premium. An insurance adjuster may try to instill fear in you because of this incident - don't let them succeed. You have nothing to fear, your insurance coverage will be more than enough for this type of event. You should freely tell the truth about the event to your insurance company and do not permit anyone to persuade you to lie. This also applies to the person who was hurt - you simply tell the truth and let the cards fall where they may - you have nothing to lose.