It really just depends on the day… Look, I know you can’t fathom that inspectors have a need for insurance but what do you base that on? The fact that you personally don’t have a need for it? Do you think I would lie when I say that I field a ton of phone calls from inspectors who have claims issues? Do you think I’m trying to scare inspectors on this message board into thinking they need insurance? If so, you got me all wrong… I’d say there are 25 or so regular participants on this type of thread which is pretty damn small relative to the global inspector community.
Just looking for actual facts beyond the usual sales hype, Ben. I know that you can’t share any … but I was kind of hoping that Pam would.
You see, I think that all E&O insurance companies are suspicious… not just yours.
My automobile insurance has a different rate for just about every kind of driver. My home insurance company varies its rates by zip code, ISO ratings, etc. My general liability insurance has different rates for different types of businesses, length of years in business, annual income variances …etc.
But E&O providers generally charge the same rate to the 20 year full time inspectors as they do the guy with the full time job at Wal-Mart who will be doing his first very home inspection when he gets home from his midnight shift next Wednesday. The only variable to what he pays is based upon the amount of deductable from his own pocket that he is willing to let the insurance company settle for … and the carrier has the right to cancel after the first claim, even if it pays nothing.
To me, this smells fishy. It is particularly suspect when no provider is willing to share how many claims are actually filed and/or paid on an annual basis … but has salesmen warning everyone of the high propensity for lawsuits with “phones ringing all day” from their clients who are being sued.
Facts will eliminate these doubts. That is all I have ever asked for.
Everything here is rumor and hearsay.
Show me data.
Why is there no data…seems fishy.
Ben also did not answer the question of exactly how many calls a day or is it actually a week,month,etc.
Sales hype? Please… how often do you see me trying to SELL insurance on this message board. Many people on here don’t even know what I do.
Would you care to address the remainder of my post (#22)?
Why was there not a home inspector section on the link that Jim previous supplied?
Bob I’ll do a better track of keeping EXACT track of the amount of calls I take and get you a report accordingly. But for now, let’s say I take about 4 to 5 calls a day. (Enter Jim’s email - "But you said your phone rings all day). But what does that number really do for you? I ask that because those are only the calls that inspectors are PROACTIVE about reporting to me.
I bet there are plenty of inspectors I insure who are afraid of calling in fear that I might raise their premium or drop them all together. Reason being? The rumors and myths about E&O insurance that Jim mentioned previously is why. I can’t speak for my competition but we don’t have a reputation for doing that. We JUST started to look at rate increases for inspectors who are repeat offenders and cost us a lot of money for claims which they are liable for. I know that will shock Jim… the fact that we do want to make a profit and recoop money on those who are substandard risk but that is how insurance works.
Kinda tough when you go back and edit it after posting…
You are comparing apples and oranges… which is common when it comes to professional liability insurance. The argument could be made that the 20 year inspector carries more liablity than the new guy fresh out of school that does few inspections. Trailing liability is a real b*tch when it comes to E&O insurance. Your auto company ain’t assuming liability for the driving you did 3 years ago the way an E&O provider does for all your previous work.
Please find me an inspector we cancelled after his first claim… All these myths and rumors and based on a general perception but you have never had any experience with how my company operates. There are inspectors who post on these threads that can attest to what I’m saying but I have to let them back me up as I’m not about to disclose who has claims…
Since you know who have filed claims and understandably do not wish to reveal their names, how about the number of them. Let’s say, just those in 2010.
And since your rates are based on what you call things that are “common” to professional liability … how about sharing those “common” numbers that you are referring to that the premiums are based on.
I’m going off the top of my head based on the inspectors I see regularly on this message board. Again, I don’t think you quite grasp how we operate but you’re still quick to pass judgement.
Nothing has changed since the last time we had this banter. And I know you like to stir the pot and rally the troops since you’re on a message board of your peers so it’s pretty easy for you to do that…
Let’s see if they surface and wish to share their experiences.
I’m delaying “judgment” until I can get some facts, Ben.
Forgive me for not relying upon your “tons” of calls from people who ring your phone “all day” in numbers that you do not record and from conversations taken from the “top of your head” as heavily as you do.
Yup… I’m lying… You got me. I’m just here to get as many clients as I can from the 20 inspectors who are reading this thread… And no better way to do it than make up stories to hopefully scare inspectors into buying insurance.
You are getting confused in the contexts in which I’m writing which goes beyond the message board. Keep in mind, I insured inspectors in all 50 states although you probably need some facts to back that up, right? Let’s face it… you don’t carry E&O insurance and I get the impression that you’ve never carried E&O insurance as you “honor your contract” and don’t have a need for it being an error proof, perfect inspector. It’s unfortunate that more inspectors are not like you but then again, guys like me wouldn’t exist if they were, right?
I don’t really care to engage in angry banter with you, Ben. I can understand your defensiveness and your need to divert the conversation away from the simple request for facts … but I am not following that lead.
My question was addressed to Pam … not you. You chose to engage in this conversation with the same lack of credible information that you choose to provide whenever the topic comes up.
Get back to your phone … the one that rings “all day” with the “tons” of inspectors insured by your company who need your assistance in dealing with the many lawsuits and potential lawsuits that are being filed on a daily basis…that are obviously too numerous for anyone to tabulate. Don’t let this stuff keep you from such important business as that. 
I’ll just wait to see what type of data Pam might … or might not … be able to provide.
So whenever I comment/counter any of the rumors or myths you hear through the grapevine about E&O insurance rate increases, cancellations, etc., etc., which is fairly easy because you don’t have any data or first hand experience of your own, you return to old faithful… So typical.
Have a good weekend.
I’ve asked for it but you say that you don’t have any, either. Without data, all you can offer is opinion … just as we all can and do.
I have seen you asked several times and never once have you provided any data either ? Do you have this data or is all what you say simply your opinion or a sales pitch ? Spill the beans if you have them, if not we know the real answer.
Jim
Which episode of the Bushart Garrison show is this?
I have lost track.
I recall from a thread many years ago…
that a claim occurs on an average of 1 in every 1500 inspections completed.
That I believe.
Still looking for that data.
We have that claim … we have the guy selling software that was marketed as preventing lawsuits that claimed that data existed to show that one in three inspectors would be sued … and another vendor claiming that according to his studies, in the course of their careers, every inspector would be sued.
When asked to provide the actual data from which they made these claims … all admitted, like Ben, that they had never actually seen such numbers. They were “told” by “reliable people” that their statements were accurate.
We know that all insurance companies subscribe to actuary services where data is compiled for them to use to calculate their rates. Somebody knows exactly, for any given year, how many home inspections were actually conducted and of those — how many resulted in lawsuits. They also know of those that actually resulted in lawsuits, how many were insured and how many were uninsured.
Premiums are based on those numbers. This is why when a new company pops up with extremely lower premiums … a red flag should go up and inspectors should consider the possibility that such a company is in the business of collecting premiums, only, and not paying claims.
Or … the other possibility is that the other carriers who have access to the same raw data are grossly overcharging.
At least one lawyer has published that home inspectors who go to court and arbitration usually win. We also know that insurance companies will often force inspectors to pay settlements instead of going to court in order to save themselves the expense of winning the case. Is it possible that … when one actually adds up all of the money paid out in inspector lawsuits in 2009, that three fourths or more of the payouts came from the inspector’s deductable and the remaining 25% came from the money insurance companies collected in premiums? If this were true, would inspectors not be better off paying their premiums into an interest bearing business account and paying out the “settlements” on their own?
Either way … unlike the data for other forms of insurance … the data behind the need and/or the premiums for E&O is conveniently missing. Since the actual facts are guarded and kept away from our unworthy eyes … we will never really know for sure, will we?
I recall a lawyer (who also sells E&O insurance related services) posting on our message board that we would “not know what to do” with the information if we had it. He then blasted what he called “lowballing” inspectors who did not advertise their E&O on their websites. He was getting some mileage on this until it was pointed out that he, himself, did not advertise his own malpractice insurance on his own website. Lawyers, as you might know, have successfully fought legislation in states that would require them to carry their own E&O because — according to the lawyers — it would “invite frivolous lawsuits” against them. Of course, who better than a lawyer would know about the incentive for a frivolous lawsuit, right? But back to the point…
We don’t know the actual numbers that the insurance carriers have and conceal from us … but we do know this. Laws are passed in some states that require home inspectors to carry this insurance to be employed. We also know that the option to cover (or to continue to cover) and inspector is at the autonomous whim of the insurance carrier. Good inspectors who have two or three frivolous lawsuits that could have been won in court … but were settled by insurance carriers to save court expenses … can have their insurance coverage cancelled and be forced out of business. Of course, this would happen AFTER he paid his premiums and paid out all of his deductables for the settlements.
I believe that the situation is such that inspectors have a right to know the facts that the insurance carriers intentionally conceal in this regard. I don’t expect insurance salesmen to agree with me on this.
“Good inspectors who have two or three frivolous lawsuits that could have been won in court … but were settled by insurance carriers to save court expenses … can have their insurance coverage cancelled and be forced out of business. Of course, this would happen AFTER he paid his premiums and paid out all of his deductables for the settlements.”
Jim, are you speaking from first hand experience of being cancelled or non-renewed by an insurance company or what you perceive to be the case? Or from the experience of other inspectors? Either way, I understand that is a common misconception about insurance companies and how they operate. Well, it’s a misconception about the way we operate. We take a good look at the claims that have been filed against an inspector when determining their insurability. If the inspector has done nothing wrong yet the insurance company spends money to resolve claims on his behalf, then why should we cancel him? Now, should the inspector has 4 frivilous claims filed against him in 1 year, then it might be time to adjust the rates accordingly. Wouldn’t your auto insurance or health insurance treat you the same way? Furthermore, if we insure an inspector who continues to have claims issues and is extremely bad risk with considerable losses (yes… they do exist, Jim. Not every inspector is a “good inspector.”), then they run a risk of being non-renewed. We are not going to insure toxic risk for the sake of keeping a very costly and high risk inspector operating in your industry. Insurance is a business just like yours and the name of the game is to make money by managing risk. If you don’t believe in insurance and would rather operate without it, then don’t buy it. More power to you…