diff --git a/web/packages/teleterm/src/services/grpcCredentials/files.test.ts b/web/packages/teleterm/src/services/grpcCredentials/files.test.ts
index 26078b02ee54a..385dfbd33f780 100644
--- a/web/packages/teleterm/src/services/grpcCredentials/files.test.ts
+++ b/web/packages/teleterm/src/services/grpcCredentials/files.test.ts
@@ -36,6 +36,10 @@ afterAll(async () => {
   await fs.rm(tempDir, { recursive: true, force: true });
 });
 
+beforeEach(() => {
+  jest.restoreAllMocks();
+});
+
 describe('readGrpcCert', () => {
   it('reads the file if the file already exists', async () => {
     await fs.writeFile(path.join(tempDir, 'already-exists'), 'foobar');
@@ -64,4 +68,17 @@ describe('readGrpcCert', () => {
       message: expect.stringContaining('within the timeout'),
     });
   });
+
+  it('returns an error if stat fails', async () => {
+    const expectedError = new Error('Something went wrong');
+    jest.spyOn(fs, 'stat').mockRejectedValue(expectedError);
+
+    await expect(
+      readGrpcCert(
+        tempDir,
+        'non-existent',
+        { timeoutMs: 100 } // Make sure that the test doesn't hang for 10s on failure.
+      )
+    ).rejects.toEqual(expectedError);
+  });
 });
diff --git a/web/packages/teleterm/src/services/grpcCredentials/files.ts b/web/packages/teleterm/src/services/grpcCredentials/files.ts
index e20c71f898f95..c8eaac1cffec4 100644
--- a/web/packages/teleterm/src/services/grpcCredentials/files.ts
+++ b/web/packages/teleterm/src/services/grpcCredentials/files.ts
@@ -17,7 +17,7 @@
  */
 
 import path from 'path';
-import { watch } from 'fs';
+import { type Stats, watch } from 'fs';
 import { readFile, writeFile, stat, rename } from 'fs/promises';
 
 import { wait } from 'shared/utils/wait';
@@ -64,7 +64,17 @@ export async function readGrpcCert(
   const abortController = new AbortController();
 
   async function fileExistsAndHasSize(): Promise<boolean> {
-    return !!(await stat(fullPath)).size;
+    let stats: Stats;
+    try {
+      stats = await stat(fullPath);
+    } catch (error) {
+      if (error?.code === 'ENOENT') {
+        return false;
+      }
+      throw error;
+    }
+
+    return !!stats.size;
   }
 
   function waitForFile(): Promise<Buffer> {
@@ -94,7 +104,7 @@ export async function readGrpcCert(
 
       fileExistsAndHasSize().then(
         exists => exists && resolve(readFile(fullPath)),
-        () => {} // Ignore err.
+        err => reject(err)
       );
     });
   }