Joe Ferry’s Home Inspector Training Blog

“The Home Inspector is Not Required to…”

Follow Your SOP - Tip 35I stress to home inspectors about the legal importance of religiously following their SOP. I know that some home inspectors exceed their SOPs to “stand out” from competitors, but these “stand-out” inspectors are also opening themselves up to more possible liability.

I have read 1000s of SOPs, and a common thread in all of them is this: many phrases that begin, “The home inspector is not required to…” followed by a host of things for which the home inspector is not responsible.

However, I still receive many questions during seminars about the figurative Pandora’s box of legal issues that could arise from exceeding the SOP. Is the SOP that strong? Does exceeding it really open the inspector up to increased possible liability?

I go deeper into the issue in this week’s video blog.

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How Much Does it Cost to Defend a Home Inspection Claim?

Tip 36 - The Costs of Defending Home Inspection Lawsuit (Part 1)“What you do consider the costs to the home inspector for defending themselves against a meritless home inspection claim, considering court costs, attorney’s fees, depositions, and more?”

I received this question from a home inspector who was likely surveying the necessity of E&O insurance as a defense mechanism against the possibility of a claim and/or lawsuit brought against him for some frivolous reason.

Fortunately for home inspectors, not every claim becomes a lawsuit. Most claims, in fact, begin as a complaint from a disappointed client. If the complaint has merit, most professional business owners have the wherewithal and acumen to appease the client to his or her satisfaction.

The issue arises when the claim is not legitimate. And that’s normally the case.

How can you defend these claims? In the first installment of this two-part “cliffhanger” video, I reveal how most claims manifest and the claimant’s and his/her attorney’s motives in filing the claim.

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Follow-Up Home Inspectors: It’s a Different House!

Tip 27 - Follow-up Inspectors: It's a Different House!You walk into a house that had already been inspected. There’s glaring issues in the basement – a massive crack in the foundation plus some apparent moisture stains. You ask yourself, “How did the initial home inspector miss these easy-to-recognize issues?”

It’s a good question, one follow-up home inspectors don’t ask enough. They are too busy looking like the hero to their client while throwing a professional colleague under the bus.

Instead, follow-up home inspectors need to recognize they are inspecting an entirely different house. What questions should they ask themselves during the re-inspection? How should they proceed with detailing the defects?

I examine these issues in this week’s ClaimsAcademy video blog.
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All Home Inspector Insurance Companies Are NOT The Same

Myth 5: All Insurance Companies Not SameMold identification is not within any home inspection standard of practice, but a home inspector told me that his insurance company settled a mold claim for $250,000. That truly made me question the sanity of the claims executive.

Yet, that story isn’t an outlier. Stories like this happen every day, as insurance companies many times would rather settle and get rid of the claim instead of fighting it.

Why is this bad news for many home inspectors? Watch the video above as I illustrate the issue and offer an easy resolution to a reoccurring problem.

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The Cost of Your Lose-Lose Proposition

Tip 37 - The Costs of Defending Home Inspection Lawsuit (Part 2)The county sheriff arrives on your doorstep. Your heart sinks. A home inspection client of yours is demanding you pay for the bad results that occurred months after your original inspection.

Your goal is too be dismissed from this massive claim – which includes you, the seller, the seller’s agent, the buyer’s agent, so on and so on – but that is increasingly difficult when there has already been a substantial calorie burn on the defense attorney’s part.

And it’s nearly impossible to be dismissed once your home inspection insurance company appoints legal counsel because its financial incentive is to settle the claim for your deductible (or offer it as part of the settlement) and walk away.

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Understand Your True Liability and Risk

Tip 25 - Understand Your True Liability and RiskMany home inspectors are SHOCKED to hear that their corporate entities (sub-chapter S or limited liability corporations) do not insulate them from personal liability for doing a negligent home inspection.

These home inspectors say that their attorneys told them about this protection when they formed their corporations. It’s simply not true.

When can a disgruntled client come after the corporation for restitution? When IS the corporation sheltered against charges? I go through the initial myth and more in this week’s video blog.
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The Kamikaze Claimant

One reads a lot of news stories nowadays about people who engage in so-called “self-destructive” behavior. I’m prone to feel sorry for these folks who can’t seem to help themselves, providing that the destructive behavior is self-confined, as well.

Unfortunately, that is rarely the case and the self-destructive behavior invariably causes collateral damage to other innocent bystanders.

I sometimes see home inspection claimants engaging in self-destructive behavior when they allow their perhaps understandable annoyance at the development of some unexpected problem with one of the systems in their new residence to morph into a full-throated and completely unwarranted attack on their home inspector’s level of professionalism.
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Charge More When Client’s Attorney Amends Your Agreement

Charging More for Client's Attorney Removing ClausesShould you allow a prospect’s attorney to line out the requirement in your inspection agreement about binding arbitration or the one that claims must be filed within one year of the home inspection?

Both clauses have value to home inspectors. In this week’s video blog, I discuss the value of these clauses, BUT also detail how you can use the attorney’s/prospect’s desires to omit these clauses as a valuable tool to charge more for the inspection.
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Disclaimers Are Your Business’ Best Protection

I encourage home inspectors to utilize the proper use of disclaimers – and go into it in some considerablTip 24 - Disclaimers Are Home Inspectors Best Friende detail – during my Law and Disorder Seminar.

A knowledgeable home inspector knows that there are many issues concerning a home-buying decision that are NOT going to be uncovered during a home inspection. Unfortunately, your clients don’t understand this fact.

That very real disconnect is the reason why home inspectors should be incorporating disclaimers into their practice. I go through a few examples of proper disclaimer usage during this week’s video blog.
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