A home inspection is performed by a home inspector as a result of the sale of a home. This inspection is an assessment of the current condition of a home. Home inspectors are professionally trained to identify issues and risks with a home and may suggest recommendations based on the inspection. A pre-inspection agreement allows you to set the exact terms of your inspection and helps insulate you. EliteMGA requires that you always have a signed pre-inspection agreement before you begin an inspection.
What is a Pre-Inspection Agreement
A critical component of the home inspection process is a pre-inspection agreement. A pre-inspection agreement should be signed by clients before a home inspector performs an inspection. A pre-inspection agreement sets clear expectations and protects the home inspector against future claims and disputes. Key elements for pre-inspection agreements are included in the contract. For added security, EliteMGA provides home inspectors with errors and omissions insurance policies that protect them from lawsuits or claims that are based on omissions or mistakes made in an inspection.
Caption: Attorney Joe Denneler explains the importance of using pre-inspection agreements for home inspectors.
What Resources are Helpful When Drafting a Pre-Inspection Agreement?
There are numerous sample pre-inspection agreements online. However, these should be used only as references. It’s important to check the state code and have the pre-inspection agreement reviewed by an attorney.
An attorney will provide suggestions on the agreement and ensure that the agreement covers the home inspector in the event of a claim or dispute. The pre-inspection agreement is the home inspector’s first line of defense if issues arise.
Sometimes, pre-inspection agreements are difficult to interpret and understand. A pre-inspection agreement must be easy to read by including proper spelling, appropriate fonts, spaces, and organized text. Although this is necessary, it’s even more imperative that the technical details of the home inspection are easy to understand. Be specific about identifying key elements for pre-inspection agreements.
Key Elements for Pre-Inspection Agreements
- Home inspection fee and due date.
- Exclusions of the inspection. The inspector does not include engineering or architectural services.
- Inclusions of the inspection. Clearly, describe the scope of services.
- Extras that can be included in the inspection for a fee.
- Limitations of liability. See a lawyer and state provisions.
- Dispute resolution process in the event of a claim.
- There is no guarantee or warranty on the inspection.
- All changes to the agreement must be in writing.
There are several types of exclusions, including items that a home inspector: never inspects, usually inspects but may exclude due to extenuating circumstances, only inspects if the client adds the service for a fee.
Why you should have an Attorney Help Write your Pre-Inspection Agreement
It’s crucial to have an attorney’s assistance when creating a pre-inspection agreement since state laws vary. Limitation of liability provisions, in particular, can be location-specific. By drafting an easy to follow and clear pre-inspection agreement, inspectors are likely to resolve disputes before a lawsuit arises, with less impact on their home inspection insurance.
A statute of limitations provision deters clients from coming back with complaints against home inspectors long after their inspection. Additionally, a severability clause protects the contract when a court voids a portion of it.
How to Protect Yourself Beyond a Pre-Inspection Agreement
Home inspectors should have detailed agreements specific to their state law that include key elements for pre-inspection agreements. Additionally, obtaining errors and omissions insurance protects home inspectors in the event of a claim if the agreement fails to protect them.
EliteMGA provides reviews of inspection contracts for the insured’s in the InterNACHI program and we give them new contracts where we can’t fix their existing contract.
EliteMGA has created an insurance program exclusively for the home inspection industry. Contact us at 1-800-355-1185 or via our website to learn more about our errors and omissions insurance and your pre-inspection agreement.