What is Home Inspector Insurance?

Jessica Bosari

Home inspectors must have special knowledge on a broad range of construction practices. Small problems can easily be overlooked, resulting in a potential law suit. Home inspector insurance is designed to cover the physical and occupational hazards that may arise.

Home inspector insurance protects home inspectors from any construction problems they may overlook.
Home inspector insurance protects home inspectors from any construction problems they may overlook.

Home inspector insurance is vital to any home inspector. Home inspectors have the job of informing an individual buyer of any defects in a home. Real estate purchase contracts are typically contingent upon successful completion of a home inspection. If the inspection is not satisfactory, the buyer can opt out of the purchase.

Lawsuits from homebuyers are common in the real estate sector.
Lawsuits from homebuyers are common in the real estate sector.

In most places, home inspectors need to have general liability coverage for potential damage that may occur to the home being inspected. A home inspector’s ladder could easily fall and cause damage to a homeowner’s property or cause someone a physical injury. The home inspector insurance will cover any settlements or costs incurred for a lawyer to defend a law suit.

Professional liability insurance may also be required to cover any errors or omissions a home inspector might make. Being certified is not enough to protect the home inspector from a law suit. In fact, certified home inspectors and licensed home inspectors are held to a higher standard because of their professional designations.

In some locations, a home inspector must be licensed to do business. Any home inspector should go through the proper training, know the construction codes, and know how to look for problems in a building. Insurance protects the inspector from any mistakes he or she may make, despite license or certification.

Real estate is a business where law suits are common in many places. Failure to report a defect can lead to law suits from the homebuyers, and from anyone who is injured because a defect was not disclosed. Home inspector insurance protects the inspector from such law suits. This is why many places require this kind of insurance. Even when it is not required, inspectors may need to show proof of insurance to prospective clients.

Home inspectors also face concerns from Realtors® who do not understand the importance of the job. A real estate agent may push an inspector to pass a home, despite any problems that may be found. While home inspector insurance covers you for accidentally missing a defect, licensed home inspectors face ethical and legal requirements and must disclose defects that they find. It is one thing to overlook a defect and quite another to notice it and not disclose it.

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