Friend's account: Her good friends hired a neighbor's teenager to keep an eye on their house and water their plants while they were on vacation. While the teenager was watering plants on their deck, the deck collapsed. The teenager is now in a wheelchair for life. The teenager's parents were "vicious" according to my friend and sued the couple for every penny they had or will ever have. Now, the couple is continuing to work past normal retirment age, and are just trying to survive, where before they were looking forward to a comfortable retirement.
1 - You've hitched a ride on a 5 year old thread.
2 - You make a good point about having the proper amount of liability insurance but I have to take the story with a grain of salt since you are relaying it third hand.
3 - If the couple had any kind of homeowners liability policy at all, the insurance company would have defended them against the lawsuit and possibly settled out of court for the policy limits if there was negligence or gone to the mat if there wasn't.
4 - Failing to inspect is not necessarily negligence. The plaintiff would have to show that the condition of the deck was obvious so that the owners knew or should have known of the hazard.
5 - If a large personal injury award would have potentially wiped them out, it's possible that the debt could have been discharged in bankruptcy.
So, you see, there's a lot you and we don't know about that couple's situation, and I doubt that your friend knows the full story either.
Still, I would encourage people to get sufficient liability limits to at least cover their assets.