E & O Insurance

Originally Posted By: Hank Allen
This post was automatically imported from our archived forum.

I did some searching through all the posts on this web-site and it is all a bit overwhelming. A lot to go through so I hope you all don’t mind answering a question that has been asked before in one way or another.

I am doing some serious thinking about taking an on location Home Inspector course so I am trying to research as many aspects of the business as I can.

Start up cost is an important factor for most I’m sure, I know it is for me. It seems the largest 2 expenses to getting started are the training and the insurance. I really figured the training would be the largest expense until I started reading posts about insurance. I must say the expense is making me really want to make sure I am serious about this endeavor. I looked over the FREA web-site and to me it looks like it will cost about $4000.00 for E&O with Liability added, plus I realize there may be other things to consider also.

I did a search for Home Inspector insurance policy’s and it doesn’t seem there are many company’s that sell it.

Is this about the best going rate for the beginner or are all reputable company’s about the same?

Thanks for your time,


Originally Posted By: afernbaugh
This post was automatically imported from our archived forum.


I went through the same routine last year at this time. I chose FREA. My first years premium was about $3,000 including General Liability and a Bond.

E&O is like an American Express card…don’t leave home with out it!

There are other companies out there but the people at FREA were very helpful and I believe that NACHI members now can get a discount.

Regards and good luck in your efforts,

Alan Fernbaugh

Five Star Inspection Services

Baton Rouge, La.

Originally Posted By: dvalley
This post was automatically imported from our archived forum.


It seems that FREA does have the best proposals for E&O insurance. You can also contact the following Insurance companies and obtain their current proposals.


David Valley
MAB Member

Massachusetts Certified Home Inspections

"Some cause happiness wherever they go; others, whenever they go."

Originally Posted By: dbowers
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Hank - If you’re looking at cheapest - FREA is it. If you’re looking at the best - Marion O. Allen out of Georgia is it. FREA’s policy is for the individual - if you want your company covered thats extra. If you want to make payments like most carriers offer thats extra. If you add a 2nd guy part-time thats extra. ETC, ETC.

Besides the normal HI program , Allen can cover about any aspect of HI you want to ensure or that you can imagine.

The cheapest carrier, is not the best carrier. Its like home inspectors.

Dan Bowers

Originally Posted By: Chris Butler
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Good morning gentleman and ladies,

I hope everyone had a great weekend, hopefully much better than mine. Sick all weekend and a funeral on Saturday. Geez fun…

Dear Mr. Allen, if you have any questions in regards to our company please give me a call.

As for all the extra charges, not entirely true. Everyone charges for going on a payment option including Allen. As for insuring your business, $290.00 additionally to insure your business name - pretty cheap for a $1,000,000 worth of coverage if you ask me. As for a 2nd guy - yes that is a separate policy. Our downside and Allen’s upside - the key thing to remember is that the claim against Joe Smith who works for you part-time or full-time is going against you and your business not Mr. Smith. That is definitely a downside of Allen or others. The benefit of having a policy for each individual is that Mr. Smith who does get that claim, now has it hit his policy and not hit you or your business’s policy.

First year for two guys the way to go is Allen - cost, plain and simple - the key though is when you get in to your second year and on - the costs go up significantly because the rates for your coverage are based on the amount of revenue you make and the amount of inspections you do. The higher those numbers, the higher you costs for insurance — with FREA the costs stay the same (unless we receiving an increase from our carrier when we renew) year after year. Hmmm - sounds pretty good when you look at it that way.

As for us being the cheapest carrier - luckily it has worked out that way for you the Home Inspector. Our membership numbers that we take to our carrier (when we renew like everyone every year) increase allowing us to keep costs down for everyone. So we might be the cheapest, but I will tell you we are the largest insurer of Home Inspectors and Home Appraisers in the country allowing you to receive the best “valued” rates. As for my relationship with Bob at Allen… he is the only company I will recommend and vis versa. So either way you can’t go wrong. The bonus - we offer a discount to NACHI members with 150 inspections or more under the belt. And that makes us an even better “value” to you the Home Inspector, individual business owner and NACHI member.

Once again, thanks you for your continued support.


Chris Butler

(former) Director of Membership @ FREA