I worry more about liability as a home inspector than I did working for a 5,000 house a year builder, OR later on as a small builder doing 10-15 houses a year.
I’ve seen top notch inspectors get sued multiple times over the years AND slimeball crappy realtor suckup soft liteweight inspectors never get touched.
Part of this is luck of the draw, PART is how you prime your clients in your verbal presentation, report and your contract (see some contract wording below).
How We Inspect: _____ Initial
The Inspection Company Guarantees they will provide the Client with a written report identifying the readily visible defects that the Inspector both observed and deemed “material” at the time and date of the inspection. The Inspection will be based upon limited observations that are mainly visual and non-invasive ; The Inspection is not technically exhaustive; The Inspection or Report is only Supplementary and Secondary to the Sellers Disclosure .
The Client understands and agrees the limited visual inspection will not detect or report on many minor defects, cosmetic concerns, or routine maintenance conditions, and if this type of inspection is desired, it is beyond the scope of a “Basic Inspection” and would require additional time and additional fee(s). Cosmetic defects or conditions that would be obvious to a casual observer may or may not be included in the report.
It is understood and agreed to by all parties that the Inspection Company is NOT an insurer and is NOT insuring the property against defects or the future condition of the structural components, or its various plumbing, mechanical and/or electrical systems. The customer agrees that EVERY property will have flaws or defects not identified in the report - property ownership brings risks. We can reduce your risk in Purchasing, but we can’t eliminate the risk nor are we assuming the risk. As part of this inspection agreement the customer agrees to allocate up to 2% of the sales price to pay for any unforeseen or unplanned repairs or breakdowns that may occur during the first 3 Years of ownership
How to not get sued:
Tell the client what you’re going to look at. Look at everything that you promised you’d look at. Know exactly what it is you’re looking at. Report on what you looked at in narrative format with a lot of objective statements. Avoid making value statements. Avoid making definitive statements.
Good advice Darren.
It’s easy to get over confident and start heading into areas we have no business in.
Hi Todd, I too questioned wether this is worth the risk of being sued, but I have decided the risk is well worth it to be my own boss and to prove to myself and everyone around that I have what it takes to do this. Have confidence in yourself. (You must if you thought this was a good idea to get into.) Be positive and get the knowledge you need and you will be just fine.
@tlanglais Where are you located? If you’re near one of the folks on this forum, maybe, just maybe, if you ask super duper nice, one of them can take you for a ride along
Good to see I am not the only one that feels the pain, after 25 years of home renovations working in Hot Florida Homes I looked at home inspection as a way to get out of hard labor well for the most part I did but like you I have hit several bumps in the road like doing WDO we were trained to do wdo on video but now my main competition seems to be following my inspections and complaining that to do WDO you have to have a pest control license this would be expensive with the threat of being shut down or sued I have stopped offering WDO until I learn more on the Rules and Regulation in Fl I can understand you feel overwhelmed at times but don’t give in to It’s not for everybody CRAP If you believe that you will give up, work on through You will get there. GOOD LUCK MY FRIEND
Don’t let the classes intimidate you about this business, but learn from them. It’s all about learning to document everything in a way that covers your ass as best as possible. Couple thoughts and questions:
Do you have a construction background? This is super helpful in this business
Use an insurance company that has products specifically designed for this industry. Carry E+O even if it is not required by your state. Don’t use State Farm or one of the other big companies because they do not understand this industry. Make sure to use a pre-inspection agreement that has a lot of limitations. The InterNACHI one is pretty good.
Never stop learning and absorb as much as you can from other inspectors here or locally. Ask questions here on the forum. Add ancillary services as soon as possible.
Trust your gut about realtors. Many are shady but some are great. There is a learning curve on the politics of this industry that will take you about 1-2 years to really understand.
I started doing this about 2.5 years ago after a long career in construction. I would never go back. This is SO much better. The client interactions are much better. I work less hours and make really good money. You will have to fight for market share, but work hard and stand by your convictions and you will be fine.
Yes, in Florida you need to be a card carrying ID holder (work for a Certified Pest Control Operator, or CPO).
If you don’t mind what are you doing to stay in compliance or what would you recommend I do short of working for a pest control company.
Richard Thomas CPI # HI12659
I refer/schedule WDO to a local Pest Control Company. I have enough things going on anyway…
I recently started my HI business. I went to an excellent school to train, and they sure did pound the lawsuit/liability thing-over and over and over. It freaked me out. I had a good discussion with one of the instructors about it, and he said they really try to make us hyper-mindful about getting sued for a number of reasons. Primarily- it is a reality…as in pretty much any business. He also said it’s so it becomes ingrained in our minds while doing an inspection to really keep us on our toes, be alert and mindful.
Keeping to our SOPs, having a good contract, staying focused during the inspection, and being clear and concise in our reporting all go a long way to avoiding trouble. There will always be the risk, albeit rare, for a lawsuit. That said, it most likely it won’t mean the end of your career, and very well could work out without much grief. Keep your information archived and well-organized and get help if you run into trouble.
After my first few inspections, I was able to breathe a bit and not worry so much about being sued. It will always be in the back of my mind, but now I am just determined to be a good inspector and do my best for the customer. That will go a long way. If someone wants to be an a-hole, I cannot stop that. I just will do good work, build my self-confidence, and live my life.
The one unspoken reason is they are covering their asses!! A shark of an Attorney who finds out you are fresh out of “training” will name them in the lawsuit as the parties that trained you, to add more names to the list of possible deep pockets!!
Yes, that is an excellent observation. Back in school, I did get that whiff (maybe more than a whiff) of self-preservation from the school regarding lawsuits. Still, I made all the “fear of being sued” work for me- as just a healthy dose of reality, keeping me careful and focused.
Home inspectors are not sued as often as you would think based on all the irrational fear among home inspectors. The reality is that anyone who is that fearful isn’t ready to be running any business.
Edited. I hope I replied in the correct place. Not sure.
You ask a difficult question. I agree with many of the pro and con comments. I have been doing this for 34 years. For consideration.
The scope or range of the required knowledge is broad and covers a century of construction. It takes time to learn.
You must perform to perfection every single day on every single job. That is tough to do.
Take any random business. Pest control - You charge $99 for a perimeter spray. People complain about bugs. It costs $5 in chemical and 1 hour of your time to resolve. In a worse case, you give them back $99 and find a new customer. The cost potential of the complaint is minimal.
Home inspection? You can make $400 and genuinely miss a major roof defect. Trade $400 for a $18,000 roof. Summary: The risk versus reward is way out of kilter.
I have 34 years of experience and would not do it the same way again. If I was young again I would start a related business and use home inspection to build it. Example: Provide pest control services; build it; quit home inspection; keep building pest control. You can sell a pest control business any day of the week. I know a man who built and sold three pest control companies in 30 years for 5 million. Very tough to do in the home inspection business.
I taught a student who followed my advice. After 4 years he quit home inspection and had a 4 truck pest control company.
The main point is you must strive to be perfect every day, every job, every week, every month, every year in home inspection. Other businesses are much more forgiving. Yes, you can make a living doing home inspection but the risk versus reward can be punishing. It’s not for everyone.
Don’t toss what you have learned. Instead, build on it. Use home inspection to market pest control, lawn services, any repair business that does not repair the home you inspected (for one year), pool cleaning, window cleaning (I know a man who makes $140k per year cleaning windows), garage door install, etc. Manage any one of these businesses properly and on Friday you go home and don’t take the job with you.
Continue on but think out of the box. RISK VERSUS REWARD
Valid points, however, like any business things vary with territory and you make a pest control business sound over simplified. You know, we know, it is not that simple or everyone would be doing it and selling it for millions.
You are correct. It does sound simplified. It’s kind of like “take 120 hours of on line training and be a home inspector”. That’s all that’s required in the majority of states and we all know that is woefully inadequate. I agree a successful business takes planning and work. Pest control is not an easy business. In my opinion the income versus risk and the ability to sell a business is out of balance for home inspection. A young person should think carefully and long term. If a person can master all aspects of inspection then any other business I referenced is simple by comparison.
It comes with territory… if you get established and market correctly, you can charge $600-750 per inspection in my area for avg size home. If you do the report correctly the liability is minimized. It is doable… Did you counter in health risks associated with working with nasty chemicals used to treat pests on daily basis? You didn’t tell us the full story. Yes, any business has liability… it is all how you do the job. Too many dumb people enter HI business and don’t take it seriously… the reports are written in a manner that makes the HI liable… reckless inspectors get in trouble and then the whole industry sounds like a constant litigation battle, it is not. Look at this board… people are doing inspections without much knowledge… well guess what
If an inspector is inspecting a pre 1987 crawlspace or basement they are probably exposed to chemicals more so than a knowledgeable pest control person (chlorinated hydrocarbons for example). Anyone who wants to know the full story can find it at the EPA or multiple internet resources. Some products are so safe they do not require EPA regulation! The point of my reply to the question originator is that there are lot of paths that can stem from inspection and not a pitch to get into pest control. To that person: don’t throw away what you learned; expand on it.