E&O Insurance Does NOT Paint a Target On Your Back

E&O Insurance No Target on BackMany home inspectors believe that if they tell a client and his/her lawyers that they don’t carry professional liability insurance, the claim will just disappear.

However, there are no shortage of clients making meritless claims. I see them every day. Would no insurance from which to collect on a judgment make the claim just go away? If claimants aren’t deterred by no rational basis for their case, how likely is it that they will stop in their tracks when they realize you don’t have insurance?
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Transferring Assets to Your Spouse Does NOT Protect You From Creditors

Transferring Assets to Spouse - No Protection From CreditorsHome inspectors often observe that putting everything in their spouse’s name would make them financially insolvent and protect them against greedy, reckless clients searching for financial blood.

In these instances, inspectors consider themselves judgment-proof and find no need to carry professional liability insurance.

However, not everything is as rosy as it looks on the surface. There are potential side effects to this scheme. I go into some of those side effects in this installment of my ClaimsAcademy video training series.
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Limitation of Liability is NOT a Home Inspector’s Best Friend

Myth 2: Limitation of Liability Not Home Inspector's Best FriendHome inspectors love Limitation of Liability clauses because, in most U.S. jurisdictions, they put a cap on a home inspector’s potential liability for negligence. However, these same clauses also stifle a home inspector’s earning potential.

How?

I describe in the video below how Limitation of Liability clauses are completely unnecessary and don’t prevent clients and co-defendants from suing home inspectors.

Make sure you click the second button below to subscribe to Joe Ferry’s ClaimsAcademy and get immediate access to my complete home inspector training video library. If you are already a member, click the first button and sign in. (more…)

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Brand X Home Inspector Insurance Companies Hazardous to Your Wealth

Tip 7 - Brand X Insurance Companies If you’ve seen any effective product-based television advertising, you know all about Brand X, the competing product that left ring around the collar, caused soapy buildup and dry lifeless hair.

In the real-world home inspection industry, Brand X Insurance companies are the ones that can cost you a small fortune. Why? As I discussed in another ClaimsAcademy report, most home inspection insurance companies have the highest instincts of self-preservation and are at all times trying to settle a claim on their most favorable terms, not yours.
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Home Inspectors: Competence Does Not Equal a Claim-Free Existence

Myth 1: Competence Equals Claim-Free ExistenceMany home inspectors believe that competence and experience guarantee a claim-free existence. They are stunned when they receive their first claim (likely a meritless one) after 20 years on the job.

As part of my home inspector training video tip series, ClaimsAcademy, the video below debunks the theory that competence equals a claim-free existence. Watch the video for further examination of the myth and how that false sense of security can hurt your business and professional reputation as a home inspector. Then make sure to sign up for my free video and case study library, which includes a robust collection of valuable information to help you, the competent home inspector, protect your business.
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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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A Home Inspector Client’s Penny-Wise, Pound-Foolish Decision

A Client's Pound-Foolish DecisionI remember the advice I received from a savvy real estate investor as I was about to purchase my first house.

It was listed at $29,000, and I inquired about whether I should offer $28,000.

The investor told me, “If you like the house, don’t lose it for $1,000. Do you know what $1,000 is? It’s $6.00 a month for the life of the mortgage.”

When broken down into those terms, who wants to lose a desirable home for $6.00/month? You can use the same logic when trying to convince possible clients NOT to go blindly with the low-ball home inspector.

I discuss this mindset in this week’s video blog.
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Extinguish All Reputation-Damaging Home Inspector Threats

Extinguish Reputation-Damaging Home Inspection ThreatsBy the time a home inspector contacts me, he or she has already made exhaustive attempts to explain to an irrational client why a leak in a roof six months after it was reported as “near the end of its life expectancy” in an inspection report is not grounds for a claim against the home inspector.

At this point, the client’s Rage-O-Meter is near the top of the “shouldn’t exceed” zone. There is no logical discussion that can change the client’s mind or mission to make you pay. While there may be no logical discussion on your end, the firm and steady end of a competent legal counsel can make that claim disappear.

In this week’s video blog, I discuss how to extinguish all of these reputation-damaging threats.
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Home Inspectors: Use CAUTION When Combining Contract Clauses

Contract clauses pre-inspection agreements Contract clauses sometimes do not mix well. There is at least one state that will nullify contractual limitation of liability clauses when paired with arbitration clauses. (Do you know which state that is? Let us know on Facebook, Twitter and/or LinkedIn.) And we all know – or should know – that arbitration clauses in pre-inspection agreements are valuable.

Find out more about what contract clauses don’t mix and how to handle this situation in this week’s home inspector training video.
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