If you’re an inspector long enough, sooner or later someone won’t be happy about it. Maybe you’ll have a customer who thinks that your work is too thorough. That can be a deal killer, and it’s sometimes unavoidable. But overlooking defects or causing damage during your inspection can be a bigger problem. Fortunately, you can protect yourself and your customers against it.
Nearly every field carries some risks, and home inspecting isn’t any different. Here’s why it happens, and how you can keep your home inspection business going if it does.
No Home Inspector is Perfect
It doesn’t really matter how thorough you are, humans make mistakes. You might not always see each defect in every home, even using a comprehensive inspection checklist. For the most part, you’ll have a system that helps prevent omissions. But what happens if there’s an outlet behind a heavy armoire that also has boxes stacked up on each side, and that outlet happens to be defective?
Inspectors inspect what’s visible and accessible at the time of the inspection. That’s in every Standards of Practice. And that’s also where good photos can help cover you. You’ll take photos of defects for your report. But photos of inaccessible areas are proof that can help your case if a claim is filed later.
Customers Don’t Always Understand What You Do
From a buyer’s perspective, an inspector is there to report every imaginable defect that the dream home might have. But you can’t know that cracked asbestos floor tiles are hiding under the carpet, because that would require pulling it up. And unless there is visible termite damage, your inspection wouldn’t see termites without digging in.
Because you know the limitations of the job, you should explain to your customers what an inspection really covers. That helps manage expectations, and a simple form that you create and print out for each customer is a simple way to achieve it. It’s not a failsafe, but it’s another step toward minimizing claims against your work.
E & O Insurance is Critical
If you’re tempted to buy only general liability insurance, you might want to reconsider that approach. General liability is cheaper, but it might not cover what you think that it does. Errors and Omissions (E & O) insurance with general liability is what you really need.
Most general liability insurance policies have a clause that Working RE magazine says excludes any error, oversight or damage caused while performing your job. But isn’t that why you have insurance in the first place? Errors and omissions insurance covers your work. If a customer has a valid claim and you find yourself in court, your E & O insurance can pay out. Without it, you’d have to pay out of pocket.
Chances are you’ll face an unhappy customer one of these days. Respond in a professional manner, says ASHI, and you’ll make great strides toward resolving it and preserving your reputation. Sometimes a claim is completely unfounded. But sometimes it’s not. With a clear idea of what you do, customers will be at least a bit less likely to fault you for a problem that crops up later. Good photos will stand as your proof of the conditions at the time of the inspection.
But above all, E & O insurance has your back. Any claims that end in a court judgement against you won’t bankrupt your business when you have the right policy. It’s not the cheapest way to go. But it’s definitely the safest.
Are you ready to jump in and start your own home inspecting business? There’s a lot to think about, but ICA School prepares you for it. Enroll now, and you can work through the courses at your own pace.