What is Errors Omissions Insurance (E & O Insurance) and Home Inspection Insurance for Home Inspecto

Professional home inspectors can be vulnerable to insurance claims even if they carefully follow all the right steps. If an error or omission occurs, home inspectors can be liable for thousands of dollars in claims. Every year, millions of dollars in E&O insurance claims are filed. E & O Insurance protects home inspectors and saves their businesses from going bankrupt over insurance claims. Errors and omissions insurance for home inspectors offers a competitive, cost effective way to protect a home inspection business. In addition, errors and omission insurance designed especially for the home inspector is usually tailored especially for the state the inspector is working in.





Home inspectors offer an objective visual investigation of the physical construction and systems of a house, from the rooftop to the foundation footers. The American Society of Home Inspectors (ASHI) outlines what is usually include a home inspection report, including the condition of:

• Heating system



• Air conditioning system



• Plumbing



• Electrical system



• Roof



• Insulation



• Attic, walls, ceilings, windows, doors, and floors



• Basement and foundation



• Optional Septic and Radon

Homeowners use inspections to identify problems, and to act on suggestions about preventative measures, in order to avert costly repairs. Inspections that fail to highlight a problem can cost homeowners thousands of dollars. This is one of the main reasons home inspectors need errors and omissions’ insurance.





All Errors Omissions Insurance policy for a home inspector is unique, and has different coverage and exclusions. The basic idea behind Errors Omissions Insurance is to help the home inspector pay for costs associated with professional liability claims. Even if the matter gets dismissed, the home inspector will still have to pay his attorney defense costs, and these costs can be significant. E & O insurance helps pay for these types of costs.





A liability claim against a home inspector must show negligence by the inspector in either performing or failing to perform what was in their contract for the home inspection. Most E & O policies have an explicit limit of liability and usually include both legal expenses and damage verdicts. No errors omissions policy covers deliberate, false or illegal activities.





Since all Errors Omissions Insurance policies are unique, you should read them very carefully to identify which types of claims are covered. In addition, as home inspection businesses grow, their insurance needs change, so they should contact their insurance provider whenever this happens.