Mandatory E&O for WDI

Have heard some talk about

  1. creating a separate inspector designation for WDI
  2. requiring E&O for WDI

My money is on number 2.

An excerpt from the Sept '09 S/W Technical Resource Center newsletter:

What an opportunity for a rant on a cold Sunday.

TDA has a tiger by the tail. “Public protection” is the typical argument. I dare em to make E&O required. Double dog dare em. I also think they need to include a BIG NOTICE on the WDI form that says “THIS INSPECTOR HAS ERRORS AND OMISSIONS INSURANCE TO PROTECT YOU” and the inspector should be required to put the name and phone number of the insurance company on the form! Any thing less would not be public protection and a hypocritical lie. If they do not require insurance notification I bet a legislator will love the idea! You know the insurance companies would line up for that; give the consumer their phone number!

Now that I got the pest people reading this riled lets add to it.

If WDI inspectors are smart fees will go to $400 per job. Anyone who does it for less is an idiot and the ones who charge higher fees will have the money to pay the claims!

Heck, I bet you cannot get an inspection done unless you buy a warranty. Let’s raise the fee to $500.

The report? I would state every report as “incomplete” on any occupied home, any home without inspection openings and any home with a conducive condition. The only home that gets a complete report must be perfect. Makes it tough for them to sue you on an incomplete report where they failed to follow your advice? I can see it now . . . HUD deal after HUD deal falling apart due to an incomplete WDI. Realtors will love TDA.

And CYA? Every inspector will recommend thermography and a dog sniffer. Reports will become 10 pages long with CYA boiler plate; heck make it 20 pages of boiler plate.

Home inspectors have E&O. They can add on WDI for $400 a year. The inspector now has the benefit over the pest control applicator. Now the home inspector can start a pest control business and take business way from the pest guys!

Hmmm how would the pest industry feel about that? I bet they say "we don’t want more people in the business BUT E&O would wipe out a bunch of guys. Question is will E&O cause more to quit than enter the business?

And the experts. You can bet your last dollar every good inspector put out of business by insurance is going to turn expert. Heck I bet the former SPCB investigators will quit teaching CEU and start doing more expert work. No one better to be an expert than a past state employee (kinda like the IRS protection ads you see on TV). Bet ya every past SPCB investigator endorses E$O.

There is no doubt termite complaints are right there next to foundation and roofs regarding property condition issues. The requirements of TDA inspection rules will bury the average inspector alive. Can you imagine how many conducive conditions the average guy leaves off a WDI? E&O will sprout law suits like grass seed on warm wet soil. I have seen a lot of other peoples WDI and they are not much better than toilet paper.

What will law suits do to TDA? It will REDUCE complaints. It is a known fact that every lawyer tells the plaintiff to not file a state complaint. They want the insurance company to sweat and they do not want the state involved. Complaints at TDA will be reduced and they will say “See what good we did?” Meanwhile license numbers will drop as well as TDA revenue.

Insurance companies? Pest control will learn its not about who is right or wrong. Its about the cost of closing the case. Small claims court is a gold mine of small nuggets to pluck. $4,000 in damages and $1,000 in expert fees. The strategy is go to small claims BEFORE you file the claim. Every expert needs to partner with a semi retired lawyer. The judge sure as heck won’t be as good at fighting the claim as the insurance company. Get the judgment THEN file the claim with the insurance company. Hard to fight a judgment. Want more leverage? Tell the WDI inspector you will not file a claim with the insurance company or State if they pony up the cash in 5 days. Oh this is so wicked. . . . . . and profitable. But the public is protected!

Contract? No one pays attention to them. You disassemble that with “negligence and incompetence” arguments. Makes every contract about as solid as warm water. The insurance company will pay $5,000 to avoid proving a contract right for $10,000 almost all the time.

Does E&O go beyond the inspection? If it extends to application; more money on the table. Can you imagine working with a lab to do termiticide concentrations to the bottom of the foundation? Bet ya 90% of termite treatments won’t pass. Why? Heck I know few people who trench and rod . . they all rod 6 inches deep on a 12 inch beam. Turn on the video; dig a hole to the bottom of the beam in three places; take a soil sample; send to lab; get back zero concentration; sue company for negligence and fraud. But wait, what if concentration comes back too high? Sue for pollution. Gosh, these guys are being set up just like home inspectors.

Now here is a bit a gas on the fire. Let’s pass a law or interpret a rule that puts more people out of work with elections coming up and this economy. The Governor will love that. There were 4500 home inspectors before E&O. now there are 2500. The recession did not put them out of business. Heck it only cost $50 bucks for the license. The E&O put em out of work. It made the license fee go to $1500.

And how about conflict of interest? I think a separate WDI license should prevent the inspecting company from treating the home. TPCA will kill it on that argument alone. Everyone knows WDI is a leader to getting business. Want public protection? Stop letting them use WDI to sell pest control.
See what a problem they cause with “public protection” arguments?

Regulate it even more. Dare ya. I need a new job as an expert. :smiley:

Here is the best part. If they require E&O then there will be two real estate transaction related trades that have it. That sets the table for mandatory E&O for Realtors. Lots of policy money there. Bet the 120,000 real estate agents would drop to 60,000. Great for the sales person but lousy for TAR and TREC lost revenue.

A safe bet would be that ANY changes made by the
state would not make it easier to obtain or maintain a certification to inspect for wood destroying insects.

A WDI CA license requires about one year to obtain. The CA has their tail hanging out there for the techs they sponsor. TREC on the other hand cranks out inspectors in 4 weeks. No experience needed as long as they can buy E&O.

Ask how many techs will be able to buy insurance or how many CA will sponsor if E&O becomes a requirment. It will be like home inspection where very few will sponsor.

In the end, you can only achieve quality with incentive and experience . . . not fear and threats. Require 5,000 hours of training (like a plumber and electrician) and pay the tech $65,000 a year and you will see quality improve.

Well, if they add an E&O requirement it will be inserted into a good bill as an addendum at the eleventh hour by some Ahole legislator tied to the insurance companies. I’ll still do WDI’s and Sponsor inspectors but you are correct, the fee’s will go through the roof. I can’t believe there are still guys out there that give these inspections away.

I wonder who the legislator is that took Shapleigh’s or McCall’s place? Neither of them are running for re-election.

3 Republicans in primary.

Well, what I meant was which statewide legislator will be “E&O Friendly” now…it could be any of them. I can’t imagine that it would again be someone taking McCall’s place, republican or not.

All spew conservative views. Texas spends more PAC money than any other state in the US. Money talks and BS walks. I think E&O is here to stay unless we find a way to make it mandatory for real estate agents. After all, I am convinced TAR played a hand in making us have it.