Insurance for the sake of Insurance?

Originally Posted By: Scott Nuxoll
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I am not a NACHI member yet (but will be soon).

My question is: If I have the customer sign an agreement for service, Why would I need E&O and or liability insurance? The agreements, (or all that I have read), state that at the time of inspection the (insert item) “appeared” to be in (blank) condition. Is it just that today’s society can and will sue over anything? If they sign a legal document, can they sue and will a court entertain that suite provided the proper documents are in order? Really confused and obviously very naive.

Thanks for any clarity on this issue.


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


The agreement is only a part of your overall protection package. Many threads have dealt with this issue, and if you do a search under E & O you will find many more opinions.

A good lawyer can beat just about any agreement. Some judges will throw out all or part of any agreement. Some states require that the agreement be in the hands of the client days before the inspection. Nothing will protect you from negligence, except E & O.

Unless your state requires E & O you are free to go without it. If you are sufficiently wealthy to cover any settlement or judgement against you plus pay all of your attorney fees, you may not need it.

Prior to opening your business, consult an attorney familiar with home inspection and contract laws in your state and find out what he thinks should be your overall protection package, i.e. type of incorporation, type of insurance, proper wording of pre inspection agreement, when and how to have the client sign. Further, I had my attorney read a copy of my inspection report in relation to my agreement to make sure all bases were covered.

In this business, perceptions are different by buyers, sellers, Realtors, attorneys and even inspectors. You are only one misstep from being sued, and it can happen anytime from your very first inspection on.

Good luck!

Blaine ![icon_biggrin.gif](upload://iKNGSw3qcRIEmXySa8gItY6Gczg.gif)