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Claiming injury compensation from companies who have ceased trading or are in administration

By Ian Morris | Updated June 22nd, 2023

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In most compensation claims following an accident at work, a solicitor knows who to address the claim to as the company will still be in business and operating at the same place. However, if a claim is delayed it can lead to problems. If you left a company after an accident at work and didn’t pursue your claim for months, the company could have moved premises or even ceased trading.

Whilst you can still pursue a claim against a company which has moved, it means that your solicitor will have to waste time tracking them down. This may seem easy, but it’s not always a simple process. For companies that have ceased trading or gone in to liquidation, it can be even harder, but there is still an opportunity to pursue your claim for personal injury compensation.

Claiming from companies in administration

If you were injured working for an employer that was already or now is in the process of an official administration at the hands of an appointed administrator, it is likely that a claim can still be made. Whilst the right to claim remains, the prospects of success are likely to be smaller than otherwise for reasons that I will explain.

If we consider claiming compensation for an injury after an accident at work from a company in administration, it will still be possible for your solicitor to liaise with the administrators who become the defacto 3rd party. The likely outcome of any claim being made against the employer will depend on whether the administrator can confirm that the employer had complied with their responsibilities to hold valid employee liability insurance and if so, what level of excess stands on the policy.

If insurance was in place before the company went in to administration and the costs of the insurance had been paid, the policy would remain effective and a claim could still stand. However, the excess cost would then become an issue. With employee liability insurance, it is common for excess amounts to range from £1000 right up to 5-figure sums. With this in mind, if an administrator confirms a high excess, it could mean that the amount of money the excess forms would be higher than the value of the claim that you may make. As the administrator will not be able to pay the excess for any claim to be made, the claimant can opt to sacrifice the excess from their claim value and then retain the balance.

This can work fine if the value of a claim substantially outweighs the excess amount. For example, if you had a claim that had a value of £10,000 in compensation, but the excess was only £1000, it would still be worth claiming as you would then stand to receive £9,000 before your legal costs were deducted, leaving you with £6,750 in settlement. Whilst this may seem unfair (and it is!) it is better than having nothing.

However, if your claim settlement was worth £1,000 and the excess was also £1,000 it would not be worth pursuing the claim, unless you really wanted to prove a point. It is also unlikely that a solicitor would continue to pursue the claim on a conditional fee agreement basis.

Claiming from companies who have ceased trading

If you make an injury claim against a company who have ceased trading, it may still be worth it. However, it is important to be honest and realise that it is not likely to be a simple process or a speedy one, and that finding a solicitor to pursue the claim on a conditional fee basis could prove very difficult.

Companies who no longer trade have no active staff, therefore requests for information will not be answered and therefore finding out who their insurers were and whether they had cover may be impossible. Most companies are limited companies and this means that if the company is closed, you cannot claim against the business owners or directors as they are not personally responsible for the losses or costs of a business.

What to do if you want to claim

If you believe that the company that you wish to pursue a claim for personal injury compensation against has gone in to administration or no longer trades you obviously won’t know where you stand until you get some specialist help. Why not contact us and let us do some investigations for you. We’ll be able to find a solicitor willing to look in to the claim and they can then evaluate the likely outcome should any claim be made. Remember, it costs you nothing to look in to claiming or making a claim for personal injury compensation. There is nothing to pay if the claim doesn’t succeed, so you have nothing to lose.

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Comments & Questions

Read on for questions and advice about claiming...

I fractured my knee after a fall at work. My company never reported it to Health & Safety. The company has now been bought by a new owner and stopped trading under the previous name. I have kept my job with the new owners in the new company. Would I be able to claim against the previous business without claiming against the new company? I wouldn’t feel comfortable claiming against the new employers.

Firstly, before we know whether or not you can make a claim, we need to understand how you fractured your knee and learn more about the incident itself. However, it is likely that a claim could proceed but it would be against the insurance that was in place under the previous regime and would not be against the new owners of the business.

If I am in the middle of a claim for a company that has ceased trading that has been ongoing for nearly 3 years with the solicitors in place is there anyway I can still claim?

Do you mean that the Solicitors you had instructed have ceased trading? If that is the case, you can certainly ‘switch’ your claim to a new firm or to one of our specialist Solicitors. Please do call us or email us (justice@direct2compensation.co.uk) so that we can help you.

I worked in engineering as a manual lathe operator. There was no extraction on the lathes, so I was inhaling smoke & also no masks were provided. I went to the industrial disease centre in Liverpool, where all evidence was put forward and the the dwp board found that I had industrial disease (namely asthma). I was awarded industrial disease disability for life. This was early to mid 90’s. In March this year, I was reassessed by the dwp and a scan showed that I now have emphysema & copd. My award went up to 50% disability for life.

The company I worked for went bust in I think 2001. Is there anything that I can do?

Have you ever claimed for the previously diagnosed industrial injury of Asthma? If so, you may not be able to return for the new diagnosis that you have received. However, it would be sensible to speak with our specialist industrial injury/illness Solicitors to find out whether or not you can take action.

If you have never taken any action in terms of a claim for compensation for the industrial disease that you now live with, you certainly should give instructions to a specialist personal injury provider – such as Direct2Compensation and the specialist Solicitors with whom we work – to act for you. As we work on a No Win No Fee basis, if it were found that the former employer was indeed liquidated and if no previous insurance cover can be accessed, the claim would fail but it would cost you nothing.

Hi , a worked for my fathers (LTD) company off and on for long for long periods of time from 1984 to 2011 , when it went into liquidation , during my times there I was exposed to very long times supervising the marble bridging saw cutting very large slabs of marble being cut to required sizes , also long periods of times of working same saw by myself , also useing kango hammers etc etc etc , can I make a claim for industrial deafness , this month been to a hearing clinic , had all tests , and require hearing aids for both ears !!!??

Potentially you can make a claim for the industrial hearing loss that you have suffered. The issue you may face will arise from the fact that the business went in to liquidation and no longer exists. If the business had active insurance cover in place at the time of liquidation, the claim may be able to proceed against that.

My son worked in a foundry for 12 years. The company ceased trading and he was made redundant. He is now suffering with bad health and this maybe caused by the lead and other materials he worked with daily. A blood test in the next few weeks will tell us exactly the cause of his problem.

Your Son may have a valid claim for industrial illness or industrial disease compensation, if it is found that his ill health is linked to his employment and his employer failed to provide him with the correct personal protective equipment and a safe working environment. He will need to make any claim within 3 years of the date that he became aware that his ill health was work related.

Hi, my children were both awarded £3250 at court after a car accident on the motorway. I have now received a letter from people dealing with the claim saying the company has gone into administration. Is there anything that can be done or will they lose their compensation?

When you say that the company has gone in to administration, do you mean the firm handling your claim or the insurers who will have to settle the claim that has been awarded against them?

If the firm handling your claim has ceased trading, the claim will still be payable – you’ll simply need to make contact with the defendant to obtain settlement.

If the defendant has gone in to administration, your children will become creditors and any administrator will consider them in the same way as any creditor.

I have loss of hearing to my right ear sustained during my time working with Alfred McAlpine in the early 2000’s, the company was taken over by Carillion in 2005. Being a large contractor all relevant insurances would have been in place at the time. I’m still in contact with a number of work colleagues from the time. My exposure at the time would have been too mechanical rivet busting machinery.

You should make an appointment with your GP to discuss your hearing loss and seek a test to confirm that it was caused by your work. You do have a right to make a claim for industrial hearing loss and this is something we can assist you with.

Hi Ian, I fractured my foot while in work. Not long after going back to work I was made redundant. I know the company I was working for has gone into administration, but it was a subsidiary of another company or being backed by them.
Is it still possible to put a claim in against them?

The company going in to administration will not prevent you from being able to pursue a claim for foot injury compensation. The issue is whether the company had insurance in place at the time of your accident and if there are sufficient assets in place to cover the excess cost that any successful claim would include.

You should certainly exercise your legal right to make a claim against your former employers if you believe that your foot injury was due to their negligence and not worry about whether or not the administration issue and lack of funds within the former employers business impacts on your claim. Of course, it would be disappointing if the administration issue did cause an otherwise valid claim to fail. However, with our No Win No Fee service, you would never have to pay any costs in that circumstance, so why not make the claim and see what happens?

Hi,
I had a fall and was injured at a hotel due to shoddy bathroom fittings. I fractured my coccyx and am still having problems 18 months later.
My solicitor intimated a claim but all communication was ignored. The owner has now placed the hotel into liquidation and the administrators have been brought in.
The administrators very helpfully told my solicitor the public liability insurance details for the time of the accident. However, the insurer has said that the claim can only progress if the owner was indemnified. I’m unsure of the meaning and implications of this in this context.
I’m facing spinal surgery and it would be nice to go private.
Do you think I stand a chance of a successful claim?
Many thanks.

You certainly have a chance of success in your claim. With regards to the insurers stance, that means that there may be an excess to pay on the insurance and as the company (hotel owner) is no longer trading, they cannot pay the excess. With this in mind, you may have to agree to have any excess deducted from settlement should you succeed.

Hi. I suffered a personal injury at work 2 years ago when I was attacked by a service user. I was out of work for 10 weeks. I was initially told that they would pay me ‘discretionary sick pay’ & then later refused. The company I work for has exchanged hands but still employs the same staff. Recently another staff member was attacked & her injuries were similar to mine. I learnt that they will be paying her a full wage until she returns in 8 weeks yet I was on SSP for 10 weeks. Would I still be able to pursue a claim even if the company now is under a new one?

The time issue is not a problem as you have a claim limitation period of 3 years. As 2 have passed, you have a further 12 months left in which you can make a claim.

The issue you will have is that you will have to demonstrate employer negligence to pursue a claim against the employer. As you were attacked, it could be that this is a criminal injuries claim. As such, was the incident reported to the Police?

My company were struggling financially and we were constantly being left on our own. We move furniture in a shop and into vans and customer vehicles. A number of staff complained about the risk and I then subsequently had an injury. I was lifting a piece of furniture into the car and the customer then shut the book with my finger in it. I broke my middle finger and had to have surgery. I was in pain for weeks and still do not have feeling in it. The company went into liquidation and I have tried to pursue this but they say because of vicarious liability they are not responsible. I don’t understand how they cant be. There were also no first aid trained staff in the company.

You say that you have already tried to claim, but the claim has failed. Were you represented by a specialist Solicitor? If so, it would seem that the defendants have mounted a strong defence that has been considered by your Solicitor to be robust and likely to stand up to court scrutiny. If this is the case, there is very little that could be done without new evidence to materially undermine any defence raised.

I worked for a company called Mark Group Ltd who ceased trading in 2015. I was required to use a Hi-impact Drill for long periods of time to carry out cavity wall insulation tasks. I had to use the drill all day every day and use it with either hand. The company did not make us aware of any risks and no assessment or monitoring was ever done. I am now starting to show signs of HAVS and am booked in with my G.P for some tests. Is this something I can pursue as an industrial injury? It is starting to affect my current ability to work.

As long as your symptoms started less than 3 years ago, you could be within the claim limitation period of 3 years. Whilst you can still pursue a claim against the company if they have ceased trading, as you can imagine, it can sometimes become impossible to obtain a compensation settlement. That said, once you have had your tests at the GP and if a repetitive strain injury like HAVS is confirmed, you should contact us so that we can investigate this further for you.

Hello I’m making enquiries for my uncle who was injured at works as a result of a failure of Temporary Works. There was no negligence from the contractor who installed the support, but was caused due to a fault with the design. The designers closed business in January. Does the fault now pass onto the contractor?

If a contractor has constructed something as per the plans laid out by an engineer or designer, liability for any issues caused by a failure of the structure would rest with the designers.

If the designers have ceased trading, there may still be a possibility of pursuing a claim against the insurance that they had in place at the time of operating.

My father worked most of his adult life with the same company, he has recently been diagnosed with COPD as the result of working conditions during his time with his employer. In 2006 this company went into administration leaving 450 employees out of work, it was subsequently taken over by another company within the same industry. This company continues to trade today although not on the same site. Is my father entitled to make a claim?

Our specialist Solicitors can certainly investigate your Father’s situation with a view to pursuing a claim for compensation if the relevant criteria are met. Given the nature of COPD symptoms and the fact that we operate on a fully No Win No Fee basis, we’d like to speak with him or yourself in relation to this so that we can then get the right specialist Solicitor to discuss things in detail with him and if applicable, run some searches on the insurance situation of his former employers and then go from there.

My daughter slipped on a wet floor in a restaurant, she was taken to the hospital with a nasty fracture to her elbow and put in plaster overnight. she had an operation the following morning to have a metal plate put into her arm. We have contacted a solicitor and everything is proceeding…. but we have just found out that the restaurant has now closed down. Where do we stand as far as our injury claim is to proceed?

The claim against the restaurant in question can proceed, even if the business has ceased trading. When the business was open, it should have had public liability insurance in place. In the vast majority of claims for personal injury compensation, a claim is made against such insurance cover. In this case, the policy will still provide cover for the business for the period that the policy covered – which should cover your Daughter.

If the restaurant had no such insurance in place, the fact that it has ceased trading could leave the claim high and dry.

Had a road traffic accident in Feb 2016, we were rear ended, our solicitor has took so long to get the claim sorted that the insurance company has gone into liquidation. We have accepted an amount of payout so we were looking forward to a holiday to get over this stress, but no chance. He is saying the FSA are not any help. I think the solicitor has done a bad job from beginning to end, endless chasing up, and now this. What can we do?

If you believe that your Solicitor has acted poorly or been negligent in their handling of your claim, you must act quickly to get this investigated.

You should immediately contact the Law Society and get some advice on this issue. You need to register a formal complaint with your Solicitor firm and allow them to investigate the complaint. If they are unable to satisfy your complaint you can then seek an investigation from the Law Society and if they find that there has been negligence from your Solicitor, you may be given leave to seek damages from them.

I had a very bad burn off a radiator when I stayed at a hotel. I was scarred. I filled out an accident sheet and I have put a claim in but they will not reply to my solicitor. I have looked up the company and it said it dissolved 2 months later, the hotel is still up and running, it’s on trip advisor and booking.com but how do i get hold of the person who had the hotel before it dissolved and would I still be able to persue my claim?

Your Solicitor should be able to identify whether the business was properly closed and placed in either administration or liquidation. The new business may well appear to be exactly the same from the outside – trading under the same hotel name etc, but if the business is new and correctly registered, it will not be liable for the incident in which you were injured.

The claim MUST go against the original company and their owners/insurers.

My mum and sister were injured whilst sat on a bus and a car crashed into it, the firm they was using have now been shut down due to fraud, they are not sure where to go or who they need to seek advice from?

Our Solicitors will be able to conduct an insurance check on the bus company in question and if cover was in place when the businesses went in to administration or were closed, the claims can still be brought against those policies at this stage. Our article on bus accident claims may also be of interest.

I’ve been diagnosed with HAVS recently but the company where I mostly used vibrating tools have been taken over, can I make a claim?

If the company that you worked for no longer exists because it has either been taken over or gone into liquidation/administration, there is still a possibility that you can pursue a claim for compensation. You certainly have nothing to lose at this stage, and possibly a compensation settlement and rehabilitation therapies to obtain if you were to succeed with a claim for HAVS compensation.

We look forward to hearing from you.

I was the passenger in a taxi that was involved in a crash, i instructed a firm to claim for personal injury, the claim has been going on over a year now, my lawyers have sent me to various doctors etc and the company had admitted liability. I was waiting on a cheque coming from them to cover my travel expenses to all of these specialist, as it’s cost me a lot so far. Now i have been informed that the company Enterprise has went into liquidation? Just as my claim was being settled, can anyone tell me if i will still receive my compensation?

If the insurers who are fielding the claim on behalf of the 3rd party (Enterprise?) have accepted liability, then you ought to be receiving compensation from them – as soon as the extent of the injuries and losses have been agreed.

However, if the 3rd party have since been liquidated it could cause a problem to your claim. Although the insurers have admitted liability, if the company that has taken the insurance policy out has ceased trading, it could be that there is no funds available to pay the excess premium that would accompany any settlement. Clearly, I do not know the details of the specific insurance and the situation with Enterprise, but this may be the case for you.

When anyone makes a claim for compensation, the insured must pay a previously agreed excess. In your case, if the 3rd parties excess is higher than the value of your claim, there is no way the claim could proceed. Alternatively, if the excess is substantial, but lower than the value of the claim, you could still pursue the claim but YOU would have to pay the excess fee to obtain the settlement.