Home inspectors have many things to concentrate and report on during the course of an inspection. There are multiple areas of concern which need to be inspected, such as the foundation, the roof, the electrical system, and the plumbing. Depending upon the state and age of the property, there may also be a number of potential dangers to contend with. Vagrants, pests, damaged or warped floors and ceilings are just some of the hazards home inspectors must contend with. Because there are so many different factors that must be taken into consideration when inspecting homes, it’s best to make sure that you are properly insured against multiple potential liabilities.
Types of insurance for home inspectors
Like any other professional business, insurance for home inspectors is extremely important. Home buyers, arguably making the largest investment of their lives, rely on the professional home inspector for his/her expertise in determining the state of the home they are buying. Because this is such a large investment, the potential for someone to sue is much greater. As an inspector, how can you be sure that you have the correct amount and type of coverage? First, you will want to check and see what insurance requirements your state or region has set for home inspectors, to make sure that you are completely covered according to local and state laws. You’ll also want to talk to other established inspectors in your area and see what insurance they may have. Along with talking to other inspectors, take a look at the average home value in your area that you may be inspecting. Are you going to be providing ancillary services such as termite inspections, radon, infrared or pool and spa inspections? Once you have educated yourself on the requirements for your state and done some research, you should consider purchasing, at the minimum, Errors and Omissions (E&O) Insurance, and General Liability (GL) insurance. Both of these types of insurance can help protect you from the eventuality of being brought into a lawsuit. Unfortunately, it is not a matter of if, but a matter of when you’ll be sued.
Errors and omissions insurance for home inspectors
Errors and Omissions insurance for home inspectors is by far the most utilized insurance for home inspectors. A majority of claims come from a buyer stating the inspector missed something of importance during the inspection. Many buyers forget that a home inspection is just a visual inspection at that specific moment in time and feel the inspector should have foreseen, for example, the hot water heater going out or the presence of water intrusion behind the drywall. Errors & Omissions insurance is there to protect an inspector in the case of the buyer feeling something was missed, along with actual, accidental oversight. With so many areas inspectors are expected to cover during the course of a home inspection, it is natural that oversight can and does occur. In the event the inspector omits an area of concern, E&O insurance is there to pay for the inspector’s defense and any potential payout to the inspectors client. Since claims can range from as little as the inspection fee returned to $250,000 and up, E&O insurance can give peace of mind to an inspector. One oversight or misinformed client will not lead to their business closing.
General liability insurance for home inspectors
General Liability is fairly standard insurance for home inspectors. General Liability for home inspectors is meant to cover slip and fall type accidents. For example, if an inspector were to fall through an attic or a young child climbs the inspector’s ladder and subsequently breaks their arm from falling, GL insurance is there to cover the bodily injury and property damage. No matter how careful you are, there is no guarantee on the job that everything will go smoothly. A majority of the time, unintentional property damage is the most common General Liability claim. Many builders and realtors may also require General Liability insurance in order to access a property to be inspected.
Choose The Right Insurance For Yourself
As an inspector, you have enough to worry about between growing your business, customer service, continuing education, and actually performing a quality inspection. Make sure that you are protected with the right kind of insurance so that you can give your full attention to your clients and sleep better at night. EiiPro offers both E&O and GL insurance specialized for home inspectors. Contact us for a free quote, and to find out more about how you can protect yourself and your business.