Home Inspector Insurance

A house is often the biggest financial investment of someone's life. As such, if something goes wrong during the inspection, they may be more likely to sue. Home inspectors need to protect themselves in case of professional errors on the job and other common risks that come along with their trade.

Fortunately, a local independent insurance agent can help you find all the home inspector insurance you need. They'll make sure you're covered from multiple liability standpoints. But first, here's a closer look at what home inspector insurance covers, why it's necessary, and more.

What Is Home Inspector Insurance?

Home inspector insurance combines various types of coverage necessary to protect these professionals in their line of work. Policies often come with critical forms of liability coverage, including professional liability insurance and general liability insurance. A complete home inspector insurance policy likely also includes other forms of coverage, such as for your business vehicles, cyber protection, and more.

Is Home Inspector Insurance Required?

In the recent past, thousands of homeowners sued over "soft inspections" done by home inspectors. Their claims declared bias toward selling the house on behalf of the realtor who got them the lead. These lawsuits and others can cost tens of thousands of dollars to settle, which can be financially devastating for your business without the right coverage.

Because a home is such a huge investment for consumers, as a home inspector, you can potentially face major liability if the results of your inspection aren't accurate. You may also face charges for accidentally damaging the property during your inspection or other common mistakes. Home inspector insurance can give you protection from major financial losses that could otherwise ruin your business.

It's also important to understand that many states actually require home inspectors to have liability insurance. This coverage is required for home inspectors in the following states:

If you work as a home inspector in any of these locations, ask a local independent insurance agent to help you ensure you have enough liability coverage to satisfy state requirements.

General Liability Insurance for Home Inspectors

General liability insurance is the most fundamental policy that all business owners and entrepreneurs need. This key component of business insurance provides financial protection against third-party claims of personal property damage or bodily injury. This coverage is critical for home inspectors because mistakes can easily happen when inspecting a home. For example, you may accidentally smash a window when leaning a ladder against the side of a house.

To make sure you’re protected against risks like this and others, you’ll need a home inspection insurance policy that includes general liability coverage. This coverage pays for the costs of third-party medical care or property repair. It will also cover your legal defense, such as attorney and court expenses, as well as any settlements or judgments you're ordered to pay. Be sure to talk with an independent insurance agent about the liability limits that are appropriate for your home inspection business.

Professional Liability Insurance for Home Inspectors

Even the slightest professional mistake or omission could leave you facing a lawsuit from a buyer. Homebuyers may assume you’ll discover every minor defect in the home they’re interested in and may hold you accountable if something’s overlooked. That's why you also need professional liability insurance designed for home inspectors.

This coverage provides financial protection in case you unknowingly make an error while inspecting a home or commercial property. It covers your legal defense, third-party expenses, and settlements or judgments you must pay in case you make a mistake, error, or omission while performing a home inspection. 

You can usually find coverage related to the following inspections and testing:

This additional coverage is also often available:

Professional liability insurance is just as crucial to have in your home inspector insurance policy as general liability insurance. Make sure to work with an independent insurance agent to get all the professional liability protection you need for your home inspection business.

Business Owners Policy Insurance for Home Inspectors

Many home inspectors can benefit from a business owners policy (BOP), which combines several important commercial coverages into a simple, affordable insurance package. BOPs are designed for small businesses that earn less than $5 million a year and have fewer than 100 employees. Home inspection firms that employ multiple home inspectors and other workers need to consider a BOP, potentially with additional coverage to fully protect their business assets. 

This policy typically offers you the following coverages:

BOPs can provide a lot of the critical coverage needed by home inspectors in a simple and affordable package. Ask your independent insurance agent if a BOP is right for your home inspection firm or business.

Additional Business Insurance Coverage Options for Home Inspectors

Home inspectors often need multiple forms of insurance beyond liability. For example, if you have employees, workers' compensation insurance is usually required by law. State laws vary, so check with your independent insurance agent to get clarification on the coverage regulations in your state. 

Workers' compensation covers your employees for work-related injury, illness, or death and can reimburse them for lost wages while they need time off to recover. If you don’t have any employees besides yourself, you may not have to carry this coverage.

Commercial vehicle insurance is also usually necessary in a business like home inspection, as you regularly travel from one job site to another. It covers business-owned vehicles against many potential threats, including liability and vandalism. If you use a business vehicle for your home inspection firm, ask your independent insurance agent about commercial auto insurance.

If you store your clients' or employees' personal records in your business's computer system, you'll also need to look into getting cyber liability insurance. This coverage can reimburse you for incidents of data breach or cyber-attacks that may expose or distribute sensitive data and records. In such instances, your home inspection business may be sued for damages. Your independent insurance agent can help ensure your home inspection business is protected from each necessary angle, including digital.

How Much Does Home Inspector Insurance Cost?

The cost of home inspector insurance can vary based on many different factors. These can include:

• The number of employees you have
• Your business's claims history
• The size of your business's payroll
• The type of assets you have
• The type and amount of commercial property you own

A local independent insurance agent can help you find affordable home inspection business insurance in your area.

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Benefits of an Independent Insurance Agent

If your home inspection business is in need of liability and other protection, no one's better equipped to help than independent insurance agents. These agents have access to multiple insurance companies, so they're free to shop and compare policies and rates for you. 

They'll provide you with multiple quotes so you can compare your options and choose the best overall coverage for your unique home inspection business. And down the road, your agent can help you update your coverage and even file business insurance claims for you.