As a franchisee, you know professionalism and attention to the job is key to minimizing your risk of professional liability claims. But with everything that could go wrong, the prospect of a claim still seems daunting.
Research shows that there are three common claims home inspectors face more than any other — those dealing with structure, water and exterior cladding. Are you prepared to handle one of these common claims home inspectors face?
Claims for structural repairs are one of the biggest sources of claims in the industry. There’s a reason for this. Structural repairs are costly, usually requiring the involvement of engineers and structural contractors.
Even when liability is questionable, it’s not uncommon for claimants to roll the dice and turn a shaky claim into a lawsuit or demand for arbitration. From the homeowner’s perspective, filing a claim can beat staring down the $35,000 bill needed to make their home safe for habitation.
Yet for home inspectors, even questionable structural claims can be a challenge to defend against, and they’re expensive because of the experts needed to mount a proper defense.
Water Intrusion Claims
Along with structural claims, water intrusion claims are the other primary type of liability claim faced by franchisees. Wet basements, leaky roofs and poor exterior grading and drainage make up a large portion of the overall claims in the industry.
Water intrusion claims can be complicated. They can involve multiple systems and components of a home and they sometimes involve mold or insect infestation.
For homeowners, these claims can be costly and confusing. Yet for inspectors, those defects can be tough to spot.
Evidence of past chronic water intrusion can easily be hidden from an inspector via paint, cleaning, air fresheners and more. Indications are also weather dependent and difficult to spot without precipitation.
Exterior Cladding Claims
The third most common source of professional liability claims are those dealing with the home’s exterior cladding, specifically stucco and EIFS.
It’s a risky area for home inspectors, as errors can be costly. The most common errors include failure to identify and report on poor drainage, missing kick-out flashings and moisture diverters, mis-leveled window ledges causing water to pour back into the cladding and lack of weep screed or other means to allow the moisture naturally collecting along the permeable surface to properly exit the structure.
It can be very difficult to diagnose a material defect involving the cladding. Unless there’s a manifestation of water intrusion in the visible areas of the home, there’s no way for an inspector to know whether the few cracks seen are evidence of a problem with the installation of the stucco or EIFS. If there is a chronic problem, the claim can be very expensive because the structural framing is generally rotted and needs to be replaced.
Protecting Against Claims
As a franchisee, it’s important to be aware of these common claims home inspectors face. However, even the best inspector practicing could one day face a claim. It’s important that you protect yourself and your business with the proper insurance protection.
At Lockton Affinity, our program is designed to meet the risks you face as a home inspector, with policies that meet franchisor requirements to ensure that you are properly insured at the best price. Plus, our dedicated team is here to support you whether you have a simple question or complex claim. It’s our way of helping to make insurance as easy as possible for our customers.