08-30-2007, 09:46 AM
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Senior Member
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Join Date: Mar 2007
Location: Nowhere, USA
Posts: 828
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Re: copy of insurance
Originally Posted by Richard Stanley
Then there's this: See #3 bold and underline are mine.
The Texas Real Estate Commission (TREC or the Commission) amended its request
for an opinion to the Office of the Attorney General (OAG) regarding the enforceability of
provisions in Senate Bill 914, 80th Legislative Session. Effective September 1, 2007,
sections 38 and 39 of Senate Bill 914 require an applicant for a license or renewal of a
home inspector license to provide proof that the applicant carries liability insurance with
a minimum level of $100,000 per occurrence of coverage to protect the public against a
violation of Chapter 1102, Texas Occupations Code. Chapter 1102 is the licensing and
regulatory law for home inspectors in Texas.
The three questions that the Commission has asked the OAG are as follows:
1. Whether sections 38 and 39 of Senate Bill 914 require a home inspector applicant
for a license or renewal of a license to carry general liability insurance, or
professional liability insurance, or both.
2. If Senate Bill 914 requires both general liability insurance and professional liability
insurance, how should the commission interpret the $100,000 per occurrence
requirement; would the bill require a minimum of $100,000 per occurrence for
each type, or $100,000 combined coverage for both?
3. Are sections 38 and 39 of Senate Bill 914 unenforceable because they are contrary
to public policy regarding insurance coverage for fraud?
The Texas Real Estate Inspector Committee (the Committee), recommended that the
Commission ask the third follow-up question regarding the type and extent of insurance
coverage required by Senate Bill 914 in light of existing provisions in Chapter 1102,
Texas Occupations Code. Among other things, Chapter 1102 prohibits a licensed home
inspector from engaging in fraud or misrepresentation while acting as a home inspector
for a buyer or seller of real property in Texas. Since neither professional or general liability
insurance will protect against fraud or misrepresentation, the Committee believes
that the insurance requirement for coverage “to protect the public against a violation of
Subchapter G” of Chapter 1102 is entirely unenforceable.
At its meeting on June 4, 2007, the Commission issued an interim policy statement
to define “liability insurance” in the amendments to Chapter 1102 to mean professional
liability insurance, also known as errors and omissions insurance, until the Office of the
Attorney General issues an opinion about the new requirements. At its August 6, 2007
meeting, the Commission voted to amend the interim policy statement to clarify that
Senate Bill 914 requires professional liability insurance only for insurable acts that also
violate Chapter 1102. The Commission believes that the new amendments do not require
insurance coverage for acts that are not insurable as against public policy.
Additional information about the new requirements for professional liability insurance
for a home inspector applicant for a license or renewal of a license, including a list
of Frequently Asked Questions, can be found on the TREC website at
TREC - Home Page.
It may well be unenforceable, but try renewing your license without it.
Aaron
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