Alert Texas Inspectors

[Thom Walker]

Texas Senate Bill SB914 was amended today to include the requirement for mandatory E/O. I recognize that there are those of you who are proponents of carrying E/O. I do not wish to debate that here. It's been beaten to death.

However, I would like to invite you, all of you, to go back through the TREC Advisor files for as far back as they go and count the total number of sanctions against Inspectors. TREC - Disciplinary Actions Main Page (http://www.trec.state.tx.us/complaintsconsumer/DiscipActions.asp)

This amendment is not consumer driven. It is driven by the industry most certain to profit from it and it is driven by a State government so dishonest that it has taken UNUSED monies from the recovery fund and added it to the general budget. There is a surplus because there have not been enough claims to use the monies already collected from Inspectors.

The following is an exact reprinting. I have inserted no diacritical markings.

""Amend CSSB 914 (House committee printing) by inserting the
following appropriately numbered SECTIONS and renumbering
subsequent SECTIONS of the bill accordingly:
SECTION ____. Section 1102.114, Occupations Code, is
amended to read as follows:
Sec. 1102.114. ISSUANCE OF LICENSE. The commission shall
issue the appropriate license to an applicant who:
(1) meets the required qualifications; [and]
(2) pays the fee required by Section 1102.352(a); and
(3) offers proof that the applicant carries liability
insurance with a minimum limit of $100,000 per occurrence to
protect the public against a violation of Subchapter G.
SECTION ____. Section 1102.203(a), Occupations Code, is
amended to read as follows:
(a) A person may renew an unexpired license by paying the
required renewal fee to the commission before the expiration date
of the license and providing proof of liability insurance as
required by Section 1102.114(3).""

[Richard Rushing]

That does not specify...

General vs Professional. Although, we know where they are headed with this abomination...

S.O.B.!!!:mad:

RR

[imported_John Smith]

Bend over and grab your ankles should this one pass.
Why dont other licensees have to carry E/O insurance?
This should be a sure fire way to drive out inspectors that arent doing a whole lot of inspections. (Me included).

Hopefully common sense will prevail.

[Rick Hurst]

Looks like General Liability Insurance to me per the statement, not E&O.

If so, should cost you make 1000. to 1500. a year.

If its E&O, different story.

[Thom Walker]

I have considered that. After hearing from Danny South it has been explained as E/O. I am waiting for clarification from the State. Not holding my breath for the answer.

[Rick Hurst]

Sounds like the same liability that just about all the other trades such as the PC industry has to carry.

My insurance man told me this was coming months ago.

I'll have a balloon policy that will cover both of my businesses.

[Scott Patterson]

If it is E&O it would or should say Professional Liability Insurance or Errors and Omissions Insurance. As it is now written it would be General Liability.

Do inspectors in TX have to have GL now?

[Rick Hurst]

Scott,

No we don't.

I already carry it myself. General Liability that is.

[Thom Walker]

If it is E&O it would or should say Professional Liability Insurance or Errors and Omissions Insurance. As it is now written it would be General Liability.

That was my first assumption. TAREI is saying it's E/O.

I feel the thread morphing into a virtues discussion again. My concerns are that the issue is not a consumer driven consumer protection issue. It has been spearheaded by the insurance industry. That's how Rick's agent knew it was coming. This amendment was just tacked on. It wasn't even part of the original discussions or the debate. And it's an issue of our State looking for revenue. They want to turn over the recovery fund to the general fund and this is an opportunity.

[Jerry Peck]

Like other have said, that's General Liability innsurance.

I used to carry $2 mil worth, it was cheap enough.

[Phillip Stojanik]

I thought it was general liability insurance at first but I am now almost convinced that E&O is what they are talking about.

The wording is...

"...to protect the public against a violation of Subchapter G."

Subchapter G from the Texas Occupations Code regarding inspectors is short and sweet and says...


"SUBCHAPTER G. PROHIBITED ACTS
Sec. 1102.301. NEGLIGENCE OR INCOMPETENCE.
An inspector may not perform a real estate
inspection in a negligent or incompetent manner."

"Negligent and incompetent" is the term TREC uses when an inspector has not followed the SoP. In other words, when the inspector has missed something. Now that's starting to sound more and more like errors and omission insurance to me.

[Thom Walker]

Read section 1102.353.d. This is why I'm so angry about MANDATED any kind of the I word.
http://www.trec.state.tx.us/pdf/rela/RELA_Sept_2005.pdf

Read my summary of the data from TREC regarding discipline occurrences for Texas inspectors from 1996 to May 2007, 10 1/4 years. It is based on data from TREC.
TREC - Disciplinary Actions Main Page (http://www.trec.state.tx.us/complaintsconsumer/DiscipActions.asp)

This is more than shameful. In my opinion it is no less than criminal collusion between the Insurance and members of the Texas Legislature. The only other explanation would be immeasurable stupidity. I guess I can accept that.

[David Banks]

"This is more than shameful. In my opinion it is no less than criminal collusion between the Insurance and members of the Texas Legislature."

And that surprises you with politicians?

[Richard Rushing]

It does look, at first glance, as General Liability. However, what Philip posted hits the bell hard with a loud and ringing sound of Professional Liability Insurance.

S.O.B.!!!:mad: This crap sucks...

Oh well... EVERY INSPECTION IN TEXAS SHOULD IMMEDIALY JUMP $100-$150 PER INSPECTION!!!! NO EXCEPTIONS (except those higher :) ).

The drastic jump will be mandated by not only premiums but also in occurrances of claims that will now be 10-fold. You'll now have every Tom-Dick-and-Harry & Assoc. advertising on the cheap television networks for litigation and trying to drum up business for their law firm while going after their new insurance treasure chests.

Oh well... just raise prices!!! Sorry Mr. & Mrs. home-buyer-- don't blame us, blame the State of Texas for breaking a system that was already fixed.

I know I won't be using any E&O company who specifically bashes "Other" organizations on private BB's...

Rich

[Scott Patterson]

I have worked under mandated E&O for right at 6 years.

I really don't care for the state telling me I must have it, but it does tend to keep the number of inspectors down. We have very few if any part-time inspectors. Also I have not seen an increase in claims, like everyone says happens. I just have not seen it.

[imported_John Smith]

Richard, you are absolutely right. Im not a TAREI member but had been thinking about joining for some time. Nows a good time, hopefully they have enough stroke to help get this stopped. If not, I would absolutely have to raise my costs $100 or more per inspection to offset the cost of the insurance.

Good time to research the inner workings of TREC and bombard them (elected officials) with emails, phone calls, letters, etc.

The TREC advisor disciplinary page is about 95% actions against real estate agents. Are they required to have E/O insurance? I dont know.

[Rick Hurst]

The realtors have to carry E&O per transaction.

They pay so much out of each transaction it when they close a deal.

Not near what the cost is for HI's.

An agent told me yesterday, she pays less than 800. a year. She also a broker.

[Erby Crofutt]

As Scott said above, E & 0 tends to weed out those not serious about the business, HOWEVER, mandating or supporting E & O to limit the competition is JUST WRONG.

General Liability here in Kentucky costs me less than $300.00 per year for $1,000,000.

[Eric Shuman]

I pay $450/year for general liability.

I do not like mandates. However, I carry that GL insurance by choice because I learned the hard way when I was contracting remodel work.

I also carry E/O and that is a different story. It is very expensive and takes quite a few inspections to cover the price. The sad part is that I do not have much faith that it would actually work to my benefit if I ever had to use it.

To each their own, but I trust the Texas governing bodies and their motivations about as far as I can see past our governer's big hair (read Merk and mandated vaccinations).

Eric

[Phillip Stojanik]

I spoke with TREC this morning and was told that it is their understanding that the intent of the amendment is indeed for E&O and not just general liability.



John said...
"Good time to research the inner workings of TREC and bombard them (elected officials) with emails, phone calls, letters, etc."


Keep in mind that this is not TREC's doing and there are no elected officials at TREC to contact. The Real Estate Commissioners and the Administrator at TREC are appointed by the Governor and everyone else is just a state employee.

This particular personal foul is coming from the legislature.

[Thom Walker]

I spoke with TREC this morning and was told that it is their understanding that the intent of the amendment is indeed for E&O and not just general liability.

Thank you for getting the answer quickly.



This particular personal foul is coming from the legislature.


Amen. More specifically, we are being fleeced by them and their buddies in the insurance industry.

[BARRY ADAIR]

Legislative Alert: From Danny South e-mail


Inspectors of Texas:


Please understand, I could easily spend 3-hours on this email explaining what all has transpired over the past 48-hours. I will not burden you.


Unfortunately we were unsuccessful in our earlier attempt(s) today of getting this amendment of “mandatory” E & O insurance to SB914 removed as we thought we would as of late last night.


Below is my version of the TAREI position statement just sent to the following Legislators. Long story short, various individuals have not been telling the truth to our Lobbyist and relaying this information back to Sen. Shapleigh & Sen.Brimer’s offices.


As of 10:30 PM last night, we were told TAR was not in favor of this amendment and that they were going to help our cause. Today, as of 9:30 AM, we were told TAR was taking a “neutral” position. At 2:30 PM, we were told TAR was “in favor” of this amendment. As of 5:17 PM, this does not appear to be the case…or so we are now told from Mr. Mark Lehman w/TAR.


Per my conversation as of 5:15 PM with Sen. Shapleigh’s Chief of Staff, Eduardo Hagert, he stated both TAR & Sunset stated: “This amendment would benefit the Consumers in Texas”.


I encourage you to take immediate action to the following individuals. This exact letter (except Word protected) was just sent to the individuals below.


Please do not simply “forward” this position statement. Form/chain letters do us NO GOOD. I have sent this “unlocked/unprotected” Word document so you may cut/paste for the key points including any other positive comments you may add. Your comments should be positive regarding pros/cons on this amendment for the Inspection Industry.


As stated in the provided letter, if the “intent” for the amendment is Consumer Protection, why not add the Brokers/Agents to have mandatory E & O. You may also wish to consider adding language regarding E & O for Builders. Here’s another thing to ponder when contacting your Legislators…

With the proposed mandatory E & O insurance, every Inspector in Texas for fear of being sued for the most minute item (remember…you now have “pockets”) will now absolutely “nit/pic” & destroy every property Inspection they perform. I wonder how the RE community will respond when their deals fall thru…repeatedly.


Individuals that must be contacted to call/email are as follows. I would also encourage you to contact your Rep. & Senators from your respective areas as well.


Sen. Eliot Shapleigh

Eliot.Shapleigh@senate.state.tx.us

(O) 512 463 0129

Chief of Staff: Mr. Eduardo Hagert


Sen. Kim Brimer

Kim.Brimer@senate.state.tx.us

(O) 512 463 0110

Chief of Staff: Ms. Jill Crocker


Rep. Vicki Truit

Vicki. Truitt@house.state.tx.us

(O) 512 463 0690


Rep. Byron Cook

Byron.Cook@house.state.tx.us

(O) 512 463 0730


Rep. Lois Kolkhorst

lois.kolkhorst@house.state.tx.us

(O) 512 463 0600


Rep. Ruth McClendon

Ruth.McClendon@house.state.tx.us

(O) 512 463 0708


Rep. Dan Flynn

Dan.Flynn @house.state.tx.us

(O) 512 463 0880



Ladies & Gentlemen, we are faced with yet another example of how the Inspectors in Texas get slammed at the “11th hour” during a Legislative Session. We must act now. At this point, we have absolutely nothing to lose & possi bly everything to gain.


I implore you to let your voices be heard. We still have a shot of getting this amendment pulled from the Senate, but…time is quickly running out. You must take action this weekend so the Legislators get this first thing Monday morning.


Thank you.

Sincerely,

Daniel F. South
TAREI President 2007-2008
************************************************** ************
May 18, 2007


Re: Amendment to SB914



Hon. Senator Shapleigh,


Texas Association of Real Estate Inspectors TAREI is considered to be the vanguard of the Inspection Industry in Texas since 1977. As current President, I urge you to pull the amendment to SB914, requiring E & O “liability insurance” for all TREC Inspectors.


Considering th e “11th hour” tactics utilized for this amendment, I have no choice but to release a Legislative Alert to all 4,400+ Texas Inspectors on this issue. Unfortunately, time is not on our side. I have compiled the following facts for your consideration in removal of said amendment:


1. As you are aware, Sunset completed their audit of TREC. On page 56 of the Sunset repo rt, FY05 resulted in 5,020 Complaints against Real Estate Brokers/Agents. Complaints on Inspectors were 235. The Inspector is the only non-biased, true third-party for Consumer protection in a real estate transaction.

2. If you look at the TREC provided data per their website for the past 10 years on Inspector complaints, the total numbers for violations and monies out of the Recovery Fund are: 53-Disciplinary Actions totaling $ 88,500.

3. With mandatory E & O, costs for Consumers on Inspections will automatically increase a minimum of 30-40% overnight.

4. Considering the option of mandatory E & O, the current system in place withi n TREC for more than 25 years for Complaint Resolution for Consumers, also known as the Recovery Fund will seize to exist. By Legislative mandate, this Fund is required to be kept at a minimum of $ 450,000 annually. I would suspect TREC’s Budget will have to find these monies thru another revenue stream as well.

5. This past year, TREC had an “Emergency Hearing” for reciprocity for Inspectors in other states (Louisiana) to practice in Texas. With inco rporating “mandatory” E & O insurance, this will surely eliminate the reciprocity agreement for other Inspectors attempting to establish their businesses in Texas.

6. For the mandatory E & O insurance, please consider the following:

Ø Many Inspectors cannot qualify for E & O for either the cost(s) or, if he/she has been involved with any form of previous Litigation. (This is almost guaranteed for exemption)

Ø There are approximately 6 Carriers in Texas who offer E &a mp; O for Inspectors. Out of the approx. 4,400 + Inspectors who will now be “required” to carry, who will write this policy and…at what cost?

Ø 2006 Sunset’s recommendations, nor TREC, nor TAR has recommended “mandatory” E & O for Inspectors. That said, if we look at the Sunset provided numbers from above with over 5,000 Complaints from Agents/Brokers, if this amendment was truly concerned about Consumer Protection, you would also include “mandatory” E & O for the Real Estate community (Agents/Brokers) as well.

Ø For certain, this requirement will cause numerous Inspectors to close their businesses. That said, for the individuals who simply cannot afford the $ 4,000-$ 7,000/year in costs for E & O, is the state of Texas prepared to generate a “Risk Management” E & O Insurance pool considering we are a “right t o work” state?



Another point of contention of said amendment is that we have confirmed as of this afternoon, neither TAR nor Sunset is in favor of this amendment. As requested on behalf of the Inspectors in Texas, why this amendment?


As eluded to, if in fact this amendment is to “take aim” at Consumer Protection, where is the public outcry? Where are the Consumers who have been harmed?


There are none as indicated by the Sunset Review process. The Recovery Fund appears to be working well today, as it has been for the past 25+ years.


I strongly urge you to remove the amendment from SB914.


Thank you.

Sincerely,

Daniel F. South
TAREI President 2007-2008

[imported_John Smith]

Thanks for the information Barry. I have already contacted all of the house/senate members you referenced in your email. We all have to stick together on this to stop this bad legislation. I see no benefit to anyone in this deal should it pass other than insurance companies, politicians and trial lawyers.

[Thom Walker]

Inspectors,
As you compose your letters, I would encourage that you also add to your list that LAWYERS IN TEXAS ARE NOT MANDATED TO CARRY E&O INSURANCE.

I would also encourage that any of you who have personal relationships with members of the news media, use it now! There is a reason that all this came down on Friday. It gives us almost no hope of responding in time.

I will be addressing a letter to TAREI requesting that they no longer allow E&O carriers as sponsers or participants in any activity. This amendment was driven by them, because they have been unsuccessful in selling us the policies.

Finally, I hope to encourage TAREI to establish a fund specifically for filing suit to assure, on behalf of the outraged consumer, to assure that lawyers and all participants in Real Estate transactions be mandated to carry E&O insurance. :mad:

[Mike Boyett]

Since I live in Austin I will possibly attempt to hand deliver my written opposition response to the amendment to the two senators on Monday or Tuesday. If any of you would like for me to include your written response along with mine then e-mail a .pdf or Word file to me at borntxn@gmail.com asap! Please keep it to one page if at all possible and formatted as a formal letter, not a copy of an e-mail you may send separately. Also, please consider this as in addition to, not in lieu of, any other means you plan to use to get your opinion to the legislators. I plan to only deliver to the two senators.

[Randy Aldering]

"Requiring" any person or profession to carry insurance of any type increases the potential for lawsuits. It does nothing for the consumer. It certainly helps keep trial attorneys employed. At the expense of the consumer, I would add. Certainly, high insurance premiums will result in higher professional fees from home inspectors!

[Thom Walker]

I do hope you are keeping those cards and letters coming. I have attached mine for any who may care to read it.

In the event this Bill passes with the addressed amendment in place, it is my intention to see if I can get any of the media interested in how this amendment could have been attached. This needs investigation. To that point, any of you who are willing, if you will email me (pdf or word) the contact names or titles at:

TV stations in your area that you recognize as leading your market regarding consumer or ombudsman activity
Newspapers that are known to investigate and report corruption in Government agencies and the legislatureI will take it from there. I will not give up until my resources are exhauted. If I do not get interested responses, I will take the information to other newspapers and Media in major cities outside Texas. Your names will not be used without your permission.

It is my goal that either we will not be mandated to carry this particular insurance or that every profession mentioned in my letter will be mandated to carry it.

My personal email is: tcwalker@c5comm.com

[Mike Boyett]

Since I live in Austin I will possibly attempt to hand deliver my written opposition response to the amendment to the two senators on Monday or Tuesday.OK, Mine and two other inspector's opposition letters were hand delivered to Senators Shapleigh and Brimer this morning. With luck, they will be read before the next vote on SB914 this week.

[Thom Walker]

Thank you, Mike.

[james walker]

Brian

As a Texas Inspector the below statement offends and disturbs me with what has transpired in the last 3/4 days!

InspectionNews e-mail is Sponsored By:
FREA Insurance FREA:Insurance for Home Inspectors and Appraisers - Home (http://www.FREA.com)
******************************

James Walker

[Mike Boyett]

As of 7pm, Monday, 5/21 it appears that SB914, as amended, was passed by the Senate today and is on to the Gov for signature.

See: http://www.legis.state.tx.us/BillLookup/History.aspx?LegSess=80R&Bill=SB914#vote206

[Jim Luttrall]

I might not be the brightest bulb in the box, but it seems this entire bill was proposed, considered and voted into place without much public input. Seems like a backroom deal with some slick politicians getting their palms greased while protecting their contributors interest.

[imported_John Smith]

It is truly amazing how fast this went through the house and senate. I would personally like to thank everyone who called, wrote emails, and especially those that hand delivered comments to the politicians.

Whats next? Should Perry sign, everyone should immediately raise their fees 50% to help offset the cost of insurance. I think we have been somewhat selling our services too cheap for some time. TREC wants to play hard ball with licensing, the politicians want to play hard ball with insurance, inspectors should be fairly paid for providing a service that realistically could leave them in a court of law on one bad statement in a report.

Enough is enough.

[Phillip Stojanik]

As of 7pm, Monday, 5/21 it appears that SB914, as amended, was passed by the Senate today and is on to the Gov for signature.

See: http://www.legis.state.tx.us/BillLookup/History.aspx?LegSess=80R&Bill=SB914#vote206

:eek:

[Mike Boyett]

No, SB914 & its companion bill HB3250 took months of preparation, debate and open discussion in the legislature and nothing was underhanded, in my opinion, on how they were developed. It is only the very, very last minute E&O amendment inserted last Thursday that was a sleight of hand by someone. The bills have been open for all to see and comment on for anyone that wanted to follow them in the law making process. Go question Rep Brian McCall out of Plano to find out why he authored the amendment.

[George Koehl]

It is truly amazing how fast this went through the house and senate. I would personally like to thank everyone who called, wrote emails, and especially those that hand delivered comments to the politicians.

Whats next? Should Perry sign, everyone should immediately raise their fees 50% to help offset the cost of insurance. I think we have been somewhat selling our services too cheap for some time. TREC wants to play hard ball with licensing, the politicians want to play hard ball with insurance, inspectors should be fairly paid for providing a service that realistically could leave them in a court of law on one bad statement in a report.

Enough is enough.

It really is not that I want to raise my rates- raising my rates won't hurt TRECs, It will benefit the government which obviously doesn't care what the public thinks (Taxes), it will only hurt my clients who won't get a home inspection because it cost too much, and my family because selling a job will be harder.

But, I am now looking an additional 3500 a year just so my company can continue doing inspections. My rates have to go up.

All inspectors (even those who had E&O) should raise their rates as well, no your cost of business isn't going up (those with E&O)- UNTIL- the Lawsuits and settlements start rolling in. Insurance is bases on risk. As suits and settlements arise (you don't even have to be involved) and your rates will begin to increase because you, being out there doing your job is a risk to the insurance company.


Make your self a cushion, you'll probably need it .

[Thom Walker]

Brian

As a Texas Inspector the below statement offends and disturbs me with what has transpired in the last 3/4 days!

InspectionNews e-mail is Sponsored By:
FREA Insurance FREA:Insurance for Home Inspectors and Appraisers - Home (http://www.FREA.com)
******************************

James Walker

This direct quote from Frea's site offends me. It's an outright lie.

In the past few years there has been a significant increase in the number of claims filed against inspectors. Now more than ever, E&O insurance is a necessity for all home inspection businesses. FREA offers a comprehensive Claims-Made policy with the best rates and lowest deductibles.

[Richard Stanley]

I have read the previous posts. I do not see in the bill, or its references, where it specifically states E & O. I only see general liability, not professional liability, ($100,000 per occurrence). That isn't the terminology for E & O, is it? Does anyone actually know for sure..? I also do not see when it goes into effect -- other than at issuance of a license or renewal. A staggered effective date will require some to acquire it and some not within the first 2 year period - that could skew the competition factors.

[Jim Luttrall]

Richard, I just read the amendment which requires insuirance to protect the public from violations of sub chapter G of the Texas occupations code.
Sub chapter G. Prohibited acts
1102.301. Negligence or incompetence. An inspector may not perform a real estate inspection in a negligent or incompetent manner.

That is pretty much the definition of Errrors and Omisssions the way I understand it. I am still trying to digest this thing though.

The basic thing that really gets to me though is the witness in favor of this bill is the TAR (Texas Ass. of Realtors) representative. Big money wins again.
The realtors may have shot themselves in the foot on this one though. In a few years, there will likely be far fewer inspectors since the part-timers won't be as likely to spend the extra $3-$4K and won't renew their license.
The drive by inspectors will soon have enough claims to be denied insurance and thus their license. The net result MAY be fewer, better inspectors, who charge enough to stay in business and will not compromise with a "Fair to the house" report.
Intentional mis-spellings of certain words.
Jim

[Richard Stanley]

I sent an inquiry to trec earlier today re: What kind of insurance the bill requires and the effective date:
I got this answer a few minutes ago:

The effective date is 9/1/07. TREC is still in the process of determining
what type of liability insurance will be required.

I hope this information is helpful to you.

Loretta DeHay
General Counsel
Texas Real Estate Commission

[Mike Boyett]

The basic thing that really gets to me though is the witness in favor of this bill is the TAR (Texas Ass. of Realtors) representative.Jim....could you please explain that a little more.

[Jim Luttrall]

After going to the link someone else posted, you can go to the list of people responsible for filing, supporting, and witnesses appearing in favor of the bill. See for yourself.

http://www.legis.state.tx.us/BillLookup/Text.aspx?LegSess=80R&Bill=SB914

[Mike Boyett]

Jim, I'm familiar with the Texas Legislature's website and have been using it to follow SB914 the last few days. I guess there is so much information there that I'm just overlooking the information you indicated was there, i.e. that a TAR representative testified in support of the amended bill. Could you please hold my hand and show me exactly where it says that? I'd like to document that fact if I can locate it. Now, timing is important...if a TAR representative simply supported SB914 before the E&O amendment then that's exactly what I would have expected of them and would have no problem with that. If that TAR representative directly supported the E&O amendment then I'd like to make note of that though.

[Jake Guerrero]

Go question Rep Brian McCall out of Plano to find out why he authored the amendment.

From McCall's Bio:

"He is an advisor to Guaranty Insurance and Quest Network Business Solutions."

[Richard Stanley]

From McCall's Bio:

"He is an advisor to Guaranty Insurance and Quest Network Business Solutions."

And guess what they sell ---

https://www.insurance.guarantygroup.com/CommercialServices.asp?service=pro_Liability

That should be illegal.

Guess where I won't buy it.

[Richard Stanley]

I sent this to the Gov.

"Re: SB914
An ammendment to this bill was made very late in the process (last Thursday) by a member (McCall) to require liability insurance for home inspectors. McCalls bio indicates he is an advisor to an insurance company (Guaranty) that just happens to sell said insurance. The TREC inspector recovery fund has functioned quite well and returned monies to the state general fund for several years.. It does not need fixing. I urge your veto of this obvious conflict of interest. "

Probably worthless, but, ----

[George Koehl]

I sent an inquiry to trec earlier today re: What kind of insurance the bill requires and the effective date:
I got this answer a few minutes ago:

The effective date is 9/1/07. TREC is still in the process of determining
what type of liability insurance will be required.

I hope this information is helpful to you.

Loretta DeHay
General Counsel
Texas Real Estate Commission

I wrote to Rep. McCall for clarification about what type of insurance the bill made mandatory, but since I am not from district 66- I doubt I will receive a reply.

maybe someone from district 666 could ask (http://www.house.state.tx.us/members/dist66/mccall.htm) him as well.

oops, that must have been a typo and my backspace doesn't seem to be working

[Jim Luttrall]

WITNESS LISTSB 914Senate Committee ReportGovernment OrganizationMarch 26, 2007 - 1:30 PM or upon adjournment
Registering, but not testifying:
For: Gonzalez, Daniel Consultant (Texas Association of Realtors), Austin, TX
On: Alexander, Karen (Texas Real Estate Commission), Austin, TX DeHay, Loretta Attorney (Texas Real Estate Commission), Austin, TX Hassumani, Sabrina Assistant Adminstrator (Texas Real Estate Commission), Austin, TX Ninaud, Christian Policy Analyst (Sunset Advisory Commission), Austin, TX

This witness list is where I was getting my information. It does appear that the amendment was made after the date of the witness list. I doubt at this late date that there will ever be a full accounting of who was actually responsible and the reasons, but then I am not up on the political process and all the various ways to manipulate the system.

[Mike Boyett]

Jim thanks, that clears that up I think. I'm only basing my opinion of TAR's position on the letter that TAREI sent out Friday and that said that TAR was waffling on whether they supported the amendment or not. I'm sure they do support it now that it is passed.

[Rick Hurst]

Higher costs to the Inspector= Higher inspection fees passed onto Client

Higher Fees to the Client= Less Clients to Purchase a Home

Less HomeBuyers= Less Commission Fees to Agents

Every Realtor I've talked to the last few days on this subject say they had no idea this was going on.

They all ask why we can't pay for E&O as they do as a group and per transaction?

Why could this not be done as a large group as themselves?

[imported_John Smith]

Not picking on them, but where was representation from TAREI on this? They found out about it on Friday like almost everyone else? I looked at their web site today and there isnt even any mention of this.

[George Koehl]

Higher costs to the Inspector= Higher inspection fees passed onto Client

Higher Fees to the Client= Less Clients to Purchase a Home

Less HomeBuyers= Less Commission Fees to Agents

Every Realtor I've talked to the last few days on this subject say they had no idea this was going on.

They all ask why we can't pay for E&O as they do as a group and per transaction?

Why could this not be done as a large group as themselves?


I think for one thing, Inspectors (not all) are very independent (lone range-like mentality); it is my impression, that Realtors\Agents don't have the mindset as inspectors. I believe (Unfounded opinion) a lot has to do with the Inspection Industry's roots from the Trade industry- vs.- a service industry.

I don't doubt it would be possible for this (ref-> Group E&O) to occur, but not in the current state of affairs.

1st- we are not united (we are too busy playing cut-rate wars. And trying to figure out how to get the biggest piece of the pie. (again not all))
2nd- we are still under the control of TREC (something I doubt they will give up)

It doesn't surprise me one bit that Realtors\Agents didn't know about this, at least on the individual level. When an amendment get tacked on that late in the game, I would guess only a few people knew about it, and it was purposed only to benefit a select few; otherwise, if it was an amendment which was in the public\consumer interest, there would have been rumblings and discussion prior to the Thursday “sneak” attachment. I would (another uneducated guess) believe the possibility of some of the “higher-up” in TAR to have known and approved of the amendment, but unofficially speaking. And, if that is the case, TAR could come out smelling like roses while they leave REP. McCall to twist in the wind and take the, limited, but full brunt of the spotlight. Perhaps the lateness in the addition of the amendment indicates, that whoever was behind this move, hoped to sneak in two small, ambiguous sentences into the governing rules. Think about it, TREC’s legal counsel doesn’t even know what type of insurance the new law references.

Again, no hard proof or for that fact any supporting data other than gut-feeling.

[Scott Patterson]

Higher costs to the Inspector= Higher inspection fees passed onto Client

Higher Fees to the Client= Less Clients to Purchase a Home

Less HomeBuyers= Less Commission Fees to Agents

Every Realtor I've talked to the last few days on this subject say they had no idea this was going on.

They all ask why we can't pay for E&O as they do as a group and per transaction?

Why could this not be done as a large group as themselves?


If you are doing, let say 300 inspections a year, you might incur a per inspection cost of around $8 to $10 for E&O coverage. It is all relative to the amount of inspections that you are doing. Most folks that are in states with mandated E&O raise their rates I would say $20 to $30 to cover the extra cost, this is what I did in the two states I'm licensed in.

As for group coverage you need to realize that the pool of home inspectors is a great deal smaller than that of the real estate agents. The more in the pool the lower the cost. It is estimated that we have around 40,000 home inspectors in the USA. Heck in TN, I think that they have right around 70,000 real estate agents!

[Rick Hurst]

Robert,

My logic is that with all the increased fees coming, not just with our fees, but with everything else (eg. gas prices) and all that money is going to be short sided for a bunch of folks.

Hell, most folks we've seen are having to have the buyer make a contribution towards closing costs to get them in the title company.

[George Koehl]

If you are doing, let say 300 inspections a year, you might incur a per inspection cost of around $8 to $10 for E&O coverage. It is all relative to the amount of inspections that you are doing.


That is correct, but one of the big problems is getting to 300 inspections per year.

If you were to take 2 weeks off for vacation, administrative, or industry related events (education\meetings); you are running 6 inspections per week, 50 weeks a year.

At that rate, E&O would be easily worked into your price without much fuss. In fact, at that rate E&O would be a valuable business asset, I would gladly pay $8-$10 dollars for added protection.

But for those who are not running at full capacity yet, the amount that you would have to raise your inspection price to offset or even cover the cost of E&O would be detrimental to your business.


The more in the pool the lower the cost. It is estimated that we have around 40,000 home inspectors in the USA. Heck in TN, I think that they have right around 70,000 real estate agents!
That too is a good point; if I remember correctly, Texas has over 100,000 (and maybe in the neighborhood of 175,000) agents. I know Texas has about 4400 Inspectors (and if that number is correct, it really bothers me that I can’t seem to get more work) and that doesn’t even make up the population of district 66.

So add point 3 to the list-
Lack of numbers

[George Koehl]

Cahill and Boyett lay it all on the line for Texas Inspectors! (http://nachi.org/forum/showthread.php?t=17147&page=3)

post 47-59
(http://nachi.org/forum/showthread.php?p=205355#post205355)

[imported_John Smith]

The squeaky wheel gets the grease. I suggest everyone write their local papers opinions page and explain what is going on. It wont make a difference, whats done is done, but it can certainly make the politicians squirm. If you follow the money, its pretty clear these cats are on the take. I think TREC does have some liability in this. When do I get my refund for the money I paid into the general fund? No one has a claim on me.

[George Koehl]

It's not really over yet the governor still hasn't signed- he can send it back to be edited
Contact the Governor (http://www.governor.state.tx.us/contact),
Let him know how this bill will hurt the econmy, increase lawsuits, hurt the real estate market in general

we really have nothing to lose right now.

[Thom Walker]

Well, I got my first solicitation today. It would be less interesting if I were a NACHI or ASHI member. I'm not. So in his scramble to fish in as many as he can, he even chooses not to recognize TAREI as a significant entity.

I haven't checked him out yet to see if he has any personal ties to anyone in the TX legislature. In any event, there is no need for anyone to rush into anything. I understand the requirement will take effect Sept 1. I'm going to give it a couple of weeks to see if TAREI comes up with some sort of program.



HMMM, I wonder if NACHI or ASHI played any part in what just happened?

Dear Home Inspector:
If you are a member of the National Association of Certified Home Inspectors, you might recognize my name from NACHI's very popular Message Board where I answer questions posed by members on a wide variety of legal and insurance topics. If you are a non-member you might know me from a Continuing Education Seminar called LAW AND DISORDER: Survival Strategies for the Professional Home Inspector in a Litigation Nation that I conduct nationwide and that has been approved for Continuing Education Credits by both ASHI and NACHI as well as the states of Massachusetts and New Jersey.
As popular as the NACHI Message Board is, not every member visits it regularly and as a result you may not be familiar with one very huge membership benefit - the ability to secure Errors and Omissions Insurance at a preferred rate available only to NACHI members.
When the program was first developed we beta-tested it in three states: Pennsylvania, New York and Florida. At the insurer's request we did not market the program aggressively because it wanted to test the user-friendliness of the NACHI web portal for handling insurance applications. Following a year-long test, we are now able to bring this preferred Errors and Omissions Program to our entire US membership. Members are saving on average about $700 over the premium that they had previously been paying.
To obtain a quote go to: www.nachi.org/insurance (http://www.inspectionnews.net/home_inspection/www.nachi.org/insurance) and enter your User Name and Password. Premiums can be paid in four quarterly installments.
If you are not a member of NACHI but would like to learn how much you could save on your Errors and Omissions Insurance, send an email to inspectorinsurance@verizon.net with the subject line: Tell Me How Much I Can Save On E & O Insurance. Include the following information: 1. Number of Inspectors; 2. Annual Revenue; 3. Number of Years you have been a home inspector; and 4. Whether you want coverage for A. Termites, B. Radon and/or C. General Liability.
If you have any questions about this program, feel free to email or call me. I'll be happy to respond to your questions.
IMPORTANT NOTE: You do NOT need to purchase "tail coverage" to switch from your current insurance company to the NACHI E & O Program. This is DISINFORMATION that is being promulgated by competing programs that are trying to staunch the loss of premium that the NACHI program is causing.
When you apply for the insurance, you are asked for the "Retroactive Date" - this is the date on which you first became continuously insured. Example: If you first purchased E & O Insurance on January 1, 2002 and were continuously insured thereafter, your "Retroactive Date" would be January 1, 2002. Any claim that occurred subsequent to that date but which was not made until you switched insurance companies, would be covered by your new insurance company.
THUS, THERE IS NO NEED TO PURCHASE TAIL INSURANCE WHEN SWITCHING TO THE NACHI PROGRAM! IF ANYONE TELLS YOU THAT TELL THEM THAT YOU ARE GOING TO RUN THAT QUESTION BY THE INSURANCE COMMISSIONER OF THEIR STATE AND SEE HOW QUICKLY THEY CHANGE THEIR TUNE.
If you have any questions, call me directly. I'll be happy to answer any of your questions. And look for the LAW AND DISORDER Seminar when it comes to your city.
Joseph A. Ferry
Attorney at Law
Two Penn Center Plaza
Suite 200
Philadelphia, PA 19102
215.854.6444 tel.
215.243.8202 fax
josephferry@verizon.net email

[Mike Boyett]

Thom, I can assure you that no trade organization had anything to do with the E&O amendment. I can also assure you that Joe Ferry is a one of the good guys. Yes, he does represent a company providing E&O and I don't fault him one bit for letting Texas HI's know of that. I have my E&O thru them and it has saved me literally hundreds of dollars.

[John Onofrey]

Mike,

Bad timing on Ferry's part gives the appearnace of an opportunist at work. I guess I'm not the only one that raised an eyebrow when I received the above email.

After all, here we sit speculating how the attorneys will be aiming at the targets pasted on our backs by the E$O amendment - while simultaneously receiving solicitations of E$O insurance from an attorney.

My first reaction was to think "this really sucks", even though I understand the TP E$O offer is a good one.

[Mike Boyett]

John, I don't disagree with that at all. The e-mail was tacky, premature and he should have waited a while before sending it out.

[Scott Patterson]

Joe is sending that out to everyone that he has an email address for, not just the folks in TX. With Nick treating him like he did, I'm surprised that he is still calling it the NACHI insurance program. The kicker is that you now do not have to belong to NACHI, it is open to anyone.

When I looked into the program I found that it was underwritten by the same parent company that does FREA, AIG. I think the division is Lexington that Towers is using. It's good coverage and the price is in line if not lower in some cases than FREA and others.

Joe, is a good guy and very helpful.

As said, none of the HI organizations had anything to do with it. Look at the Trial Lawyers and keep in mind a very high percentage of legislators are lawyers!

[Richard Rushing]

I recieved the same email at three different addresses... My first thought was, "Friggin ambulance chasers are at it again.":mad:

Rich

[Thom Walker]

Mike, Scott,
I don't ask for much in life; a little paranoia, the freedom to develop conspiracy theories. Is it so hard to let a guy have his dreams? Geez!

I can call John to find out, but does anyone know what "coverage for the referring party means?" I hope it does not mean that we provide some form of coverage for the Realtor. That seems to be counter to being able to say that we work only in the best interest of our Clients. Additionally, if that is what it means, it seems that their E&O should be reciprocal.

[Thom Walker]

To continue, it also seems like an excellent reason to get dragged into a suit filed against the Realtor. No wonder TAR wanted to support the amendment. Smart move!

[Richard Rushing]

Thom,

It was a GREAT move on their (TAR) part. This pretty much insulates the realtors... so, all they have to do is point the finger.

RR

[George Koehl]

Thom,

It was a GREAT move on their (TAR) part. This pretty much insulates the realtors... so, all they have to do is point the finger.

RR

I think that is the short term benefit for the realtors.
But the long run is much worse:
As more and more inspectors can no longer afford to stay in business, realtor will no longer have the liabilty sheild of the inspector, And if big inspection firms move in to fill the void, these companies will have the funds and the means to deflect any and all litigation away from the company and push it back onto the agent.

Realtor are going to be hurt by this amendment as well- not as quickly as the inspectors, but they will.

People have become use to home inspection, and there is a demand.
What the state has effectively done is put measures in the works to cripple it's own Real Estate market. Will they increase the 10-day period for consumers to get the property inspected? Probably not, and let's face it, if 1/4 or 1/2 of the inspector quit or are forced out of business, many people will be forced to forego the inspection all together- placing everything back on the shoulders of the real estate agent and the seller; do you not think trial lawyers will not jump at the chance to grill a agent as to why they didn't do more to aid and secure the services of a home inspector for their client... that is professional negligence.

So, it is not merely the inspectors who should be sore at the greed of politicians, but the entire real estate profession.

[Richard Rushing]

George,

This profession, the inspection community and E&O insurance didn't just happen recently. All the above have been part of this business for quite a while... with that said, I assure you there will be enough inspectors out there in Texas to fill the void of the part-timers or new folks leaving because of E&O.

The agents who get themselves in trouble will do that no matter what the circumstances are related to our profession. As far as 1/4 of the inspectors going out of business... well, I don't see that either. Sure there are going to be some of the semi-retired folks who do this part-time who just won't be able to justify the cost increase if they only do 50 inspections per year.

By the way, agents are not taught to recommend an inspector (at least in most of Texas). They are taught to give their client a list of inspectors to choose from. Do you really think that list will shrink to 1 or 2? Naaaaaa. Aint'a goinna happen.

Most of the established inspectors do not get our business from realtors. Hell, 90% of all my inspections are referrals. Our previous customers are our advertising.

Who do you think this will hurt the established inspector or the new guy who is relying on advertising? My guess is the new guy who gets all the "shopper" calls (because his/her client-base is via advertising) will be hurt the most. Whereas the established folks who rely on referrals already have had the prospective client sold on our services, regardless of the higher price.

Cost of doing business goes up, inspection fees go up.... I could care less how it effects the realtors. I just don't believe it will cause one bit of concern for even the worst agent out there. With the referring party clause as part of the E&O requirements, it protects the most unscrupulious people in the real estate business as well as the really good ones. What group do you think the referring party clause will help?

I think the reality is that if an inspector cannot figure out what he/she needs to be charging for inspections and goes out of business because of it, then they need to purchase Brian's Cost of Doing Business program. Otherwise why would, long term, people be going out of business because of E&O?

Screw-'em... I bitch about it today, but will purchase tomorrow if needed. BFD.

Rich

[Mike Boyett]

With the referring party clause as part of the E&O requirements,....I have obviously missed something...where is that requirement spelled out?

[George Koehl]

Most of the established inspectors do not get our business from realtors. Hell, 90% of all my inspections are referrals. Our previous customers are our advertising.

Who do you think this will hurt the established inspector or the new guy who is relying on advertising? My guess is the new guy who gets all the "shopper" calls (because his/her client-base is via advertising) will be hurt the most. Whereas the established folks who rely on referrals already have had the prospective client sold on our services, regardless of the higher price.

Rich

Rich, you made some good points,
And perhaps our difference in opinion is based upon the factor that I am one of the new guys, dependent upon advertising, getting the shopper calls.
Who at one point, earlier this week saw a future and a chance to grow a business, but now am looking at the money I invested in starting the business vanish with out a thing to show for it.

Your right.
No one is terribly concerned about what happens to inspectors, not even fellow inspectors.
I guess this amendment was a good way for some old timers to thin out the herd.

[Richard Stanley]

George, I urge you to relax. We don't even know for sure what is required yet. Kind of like inspections - get all of the facts before you commit hari-kari. Concentrate on being as good an inspector as you can be and it will all work out.

[Rick Hurst]

Think of all the HI wannabe's sitting in the HI schools right now that don't have a clue about this insurance requirement.

I bet the schools are being hush hush on the matter.

You know they are not saying,

OH, by the way you'll need an extra 3500. - 4K for insurance now to get your license.

Classrooms are not going to be filling up as usual i bet.

[Richard Rushing]

GEORGE WROTE:
"Your right.
No one is terribly concerned about what happens to inspectors, not even fellow inspectors.
I guess this amendment was a good way for some old timers to thin out the herd."

Georgio-- I think you really are waaay off on the first part of your statement above. In reality, there are alot of folks on this board and others like it, feel the need to give back and advance the profession, which is just the opposite of what you described above.

RE: "the old timers thinning out the herd"... as far as I know, not one of the "old-timer-inspectors" were the ones doing the pushing of this bill. This was the State of Texas Legislature doing this dasterdly deed.

What ole Rick Hurst posted is true. The diploma mills will continue to crank out the 'herd' to the point the graduates will have so much invested that there is no way they can turn back. Once the new folks find out about the E&O requirements (as we all hope to soon), they will already have spent around 3k without any return in sight. As we all know, the first year is a real beeitch to get thru. The second is a little better and finally starts to get some referral base by the third year. This is much too difficult business to break-into without having the E&O requirment up front.

Hey George, what part of the state are you in? If you are in the DFW area, I might be able to help with some future jobs. Let me know...

Rich

[Thom Walker]

"Screw-'em... I bitch about it today, but will purchase tomorrow if needed. BFD."

If that is your entire attitude, then they win. Politicians count on that mentality from voters. Always have, always will. Voters have very short memories. However, if what you mean is, "I'll buy it because I have to in order to keep my business, but I intend on making persons like McCall accountable for their actions", then there is hope that we can make this whole system better. If the publicity from this affects his ability to take the Speaker's position, he and others will have learned a lesson. He introduced this amendment knowing that he has two years for us to forget about it. He is banking on it not being an issue at that time. I intend to prove him wrong. I'm really hoping I won't have to do this myself, but I will if I have to.

"George, I urge you to relax. We don't even know for sure what is required yet. Kind of like inspections - get all of the facts before you commit hari-kari. Concentrate on being as good an inspector as you can be and it will all work out."

George, I urge you not to relax. I urge you to stay angry, BUT stay focused. Don't quit, don't give up. Too many times, people want to talk about being good citizens, but they don't want to participate in the hard work that it takes to actually be a responsible citizen. The point is that someone did this to you for personal gain, not for the public good.

Short term anger can be productive. It is a catalyst. It will not linger forever, but at this stage it should be expected.

Mike, the referring party isn't part of the amendment, it is what was added to E&O policies quite a while ago. It was intended to encourage RE's to use inspectors that carried E&O versus those who didn't. Simply, it added more pockets.

I'm not sure that many people really understand how E&O works (aside from painting targets). E&O starts as a pot. Let's use $100K as an example. First, your legal expenses come out of that pot. That's lawyers, deposition costs, EW's, etc. What is left is what is available to the plaintiff if they prevail. If the amount of the judgment exceeds the remainder in the pot, that's your responsibility. So, initially, it sounds like a great idea to buy the most you can afford. But, it's a double edged sword. The more you carry, the more likely you are to be pursued for a longer period of time. Lawyers don't take cases where they can't make money.

And you must understand that you have no say whether it goes to trial or not. The Ins. Co. makes all the calls. Your ability to renew is based on Claims, not awards. Let's assume the unlikely scenario that it is a frivolous claim. I know that never happens, but let's assume it. :rolleyes: The suit is for $100K. Your defense to date costs equal $15K. The Ins Co. decides that a trial will cost another $40K, if they prevail. Total outlay if they "win" is $55K, minus your deductible. If they lose, it's a minimum of $100K. So they offer the "Frivolee" $25K to settle. Total cost to them is $80K. They "save" $20K. BUT, you have an $80K claim (not judgment) against you, even though you didn't do anything wrong and you didn't make any of the decisions. So what happens when you try to renew or change companies?

I have wondered; since TX is a right to work State, what will happen to Inspectors that have no TREC violations, but for whatever reason, can't find a Company to Insure them?

[Richard Stanley]

My understanding of the intricate political process is very limited.
Is it constitutional to pass a law without adequate public hearing?
If so, perhaps a judge could declare the bill unconstitutional and issue some sort of cease and desist until it returns to the full body for hearing - Is this a possibility?
Is there someone on here that has that knowledge?

[Richard Rushing]

"Screw-'em... I bitch about it today, but will purchase tomorrow if needed. BFD."

If that is your entire attitude, then they win.

NO... my attitude is that it is a foregone conculsion that the passage will go through with the governers signature. Does he have line item veto? I seriously doubt it...

Do I like this crap!? Hell-0 NO!! Do I believe it's going to happen... Hell-0 yes. Me saying I will purchase tomorrow if needed, was something everyone (yes to include you Thom) will be doing to stay in business when the requirement comes down the pipe. Not a defeatist attitude-- it's more like being a realist. I just choose not to get an usler.

I don't take this as a personal slap in my face or a kick in the crotch. I look at it kinda like the licensing thingy... all around the country we hear folks kicking and screaming about licensing and how they will die by the end of their sword (funny chaps in Fla) if it comes to that too. IT WILL COME... the whole country will eventually be licensed. Then will come the E&O requirement... eventually.

People, it's not being a defeatist if you decide to spend your energy to change those things that can be changed. I just think that this bill has been railroaded thru the state legislature by sneaking an E&O clause in at the last minute without any input from the people who are, for a lack of better term, informed as to the history and actual make-of how the system has been working to date. What's worse is, it was pushed by an individual who is obviously not working for the people of Texas' best interest in mind. But instead, was working on behalf of his political contributors to further his career.

I just choose not to hyper-ventilate about something that *IS* a probability and not yet reality. Once it becomes reality, and it will... what are you going to do? Bitch and moan day and night... not worth it.

Like it or not foks, this crap is probably going to happen and there is nothing that GOD, GOVERNER or GRANDMA can do about it. Well, maybe grandma might have a chance...

Just don't go getting on top of any towers in Austin, ala Chuck Whitman (not Hinkley).


Rich

[Scott Patterson]

Rich, that is a good take and a healthy attitude to the issue. The information that I have says that TREC does not have a problem with it and likes the idea. So if the regulating agency like is, I doubt that the Gov will not sign it.

I don't know how many times I have said this, but I have not seen an increase in lawsuits with mandated E&O. I have worked under state mandated E&O for six going on seven years.

I would say that 80% of the time home inspectors are sued when they screw-up, the remaining 20% I call the shotgun effect. You just get pulled into the lawsuit because you were involved in the transaction.

[Mike Boyett]

Just don't go getting on top of any towers in Austin, ala John Hinkley.Actually, that was Charles Whitman, but I get your drift. :)

[Richard Rushing]

Couldn't Hinkley have thought of jumping off??? :D

RR

[Richard Stanley]

"The information that I have says that TREC does not have a problem with it and likes the idea"

Scott, Per previous posts, as of a couple days ago, TREC didn't even know WTF it was. Would you mind sharing your source?

I don't personally care whether we have it or not. My choice would be not. Like others, I'll pay up front and others will pay me back - ie; price increase. - just like other expenses. :)

[Phillip Stojanik]

...The information that I have says that TREC does not have a problem with it and likes the idea. ..."

TREC has no official opinion one way or the other as far as I can tell. They will however incorporate the will of the legislation into policy when the time comes because that’s their job. Now you might find some individual TREC employees or even Commissioners who might personally think it’s a good idea.

Incidentally, TREC never before expressed an opinion that its regulated home inspectors should have a mandatory E&O policy requirement in place. If the Real Estate Commissioners felt it was important, they would have pressed for this long ago.

There has been one member of the Inspector Committee who has brought E&O up a number of times in the past. He has been strongly in favor of an E&O requirement for inspectors but he was never able to convince the rest of the IC that it was a critical issue for the public or for inspectors. Thus the Inspector Committee never advised the TREC Commissioners that a mandatory E&O requirement should be adopted for inspectors. I suspect that that one member of the Inspector Committee will be the only one doing any kind of "victory dance" down the hallways of the TREC building when this is all over.

If a mandatory E&O policy for home inspectors was ever going to come about, it was going to have to come about just as it apparently has; as an unnecessary 11th hour amendment to an otherwise justifiable piece of legislation that was destined to be signed by the Governor anyway. This one amendment wart on the entire body of SB914 is not enough to keep it from becoming the law of the land at this point.

[Scott Patterson]

"The information that I have says that TREC does not have a problem with it and likes the idea"

Scott, Per previous posts, as of a couple days ago, TREC didn't even know WTF it was. Would you mind sharing your source?

I don't personally care whether we have it or not. My choice would be not. Like others, I'll pay up front and others will pay me back - ie; price increase. - just like other expenses. :)

I had the pleasure of spending a couple of days and talking with three members of TREC while attending the Arello Welcome to the ARELLO Web Site (http://arello.org/) meeting in Banff last month. They were anticipating the changes; legal council was in favor if it happens. I did not say that TREC was forcing the change.

Like I said before, you need to look at the Trial Lawyers. They have been the force behind this in other states.

[Mike Boyett]

They were anticipating the changes; legal council was in favor if it happens.I will apologize upfront as this post will seem confrontational and that is not the intent. However...you say they were anticipating the changes. What changes? The hundreds of acceptable changes that SB914 proposed or the last minute amendment that added the E&O requirement? For sure they were anticipating the original changes brought about by SB914, we all were. I highly doubt they were anticipating the E&O amendment however. If they were then that suggests collusion to me and I would like to hear more. If it were proven that TREC staff or the one lone Inspector Committee member that Phil mentioned above did an end-around and secretly found a State Rep to support them then I think we need to know that. If TREC rep's said they anticipated the E&O amendment then something is very, very rotten here.

[Thom Walker]

If you can't grow your business revenue by $4K to compensate then you should go out of business...it means you be stupid.

There's no arguing with trailer park logic.

It has nothing to do with the cost of insurance! It has everything to do with dishonesty in government and whether or not one chooses to just go along and except whatever is dished out.

Will I buy it? Yep, no choice. Will I continue to thrive. Yep, no doubt. Am I more susceptible to frivolous lawsuits? Yes, at least according to every lawyer aquaintance I've spoken to. It's why the first question on any interrogatory is "Are you insured?"

Look guys, I imagine that just about everybody has a line they draw in the imaginary sand at which point they say "I've had enough." This was mine. I don't like being bullied. I am fully aware that this is a done deal and that it's never going to be reversed. That doesn't change the fact that it was dishonest and was based on no need and no public demand.

There's no waste of energy, no bitterness, whatever. I am angry. I am determined that the people who promoted this will not be able to comfortably hide in the shadows. Well, they might be able to, but it won't be for lack of effort on my part.

I don't have priveledged information, so I don't know what % of the time inspectors elsewhere have screwed up. But I know all the published stats regarding complaints against Texas inspectors. I know that of those times, 49% weren't filed by Clients and that of all those filed, only 21% were found to be legitimate complaints.

I also know that when malpractice awards were capped, lawsuits diminished dramatically. And I know that when ins cos withdrew mold coverage, lawsuits disappeared. I'll continue to read the posts with interest, but I won't contribute anymore. I'm beating a dead horse. You are all (well most of you) mature business men and you'll make your own decisions about what to do or not to do.

[Scott Patterson]

Sorry, I can't help Y'all with this anymore. I'm not going to help in a witch hunt over some conversations that I had while talking about the future of our profession with some friends.

Good luck, and trust me E&O is not all that bad.

[Mike Boyett]

Scott, no problem. At least now we know of one person that had this conversation a month before the bill was amended. That's really all I need to know at this time. And again, it's not the E&O requirement so much as it is the method is was enacted. Like I've said I have E&O and this will have little to no financial effect on me. However ,when certain groups preach and enforce parliamentary rules during the normal course of business then turn around and violate that I find that to be a breach of ethics. A case in point, but not related to this, is the fact that the Texas House of Representative's chief parliamentarian resigned last night around 10:00 pm due to differences of opinions with the Speaker of the House. If the amendment is challenged in the courts for a rules of order violation then I'm sure you could be deposed if needed.

[Phillip Stojanik]

If it were proven that TREC staff or the one lone Inspector Committee member that Phil mentioned above did an end-around and secretly found a State Rep to support them then I think we need to know that...

I certainly did not mean to suggest that the Inspector Committee member I mentioned had anything to do with this! In fact, I doubt very seriously that he did.

As for ARELLO, I believe that the subject of E&O insurance for inspectors was on their discussion agenda for a past meeting where TREC staff members were in attendance. Again, that does not mean TREC staff had anything to do with this either.

[Scott Patterson]

I certainly did not mean to suggest that the Inspector Committee member I mentioned had anything to do with this! In fact, I doubt very seriously that he did.

As for ARELLO, I believe that the subject of E&O insurance for inspectors was on their discussion agenda for a past meeting where TREC staff members were in attendance. Again, that does not mean TREC staff had anything to do with this either.

BINGO!

[Mike Boyett]

OK, that clears up the Arello question ( I think). Had Scott simply indicated it was an agenda item during the conference then that would had made perfect sense. His original comment inferred a different scenario. The chances of any legal challenge to the amendment are practically nil so all this bitching and moaning is just that. I do not plan to pursue this matter any further.
Phil, I know you were not suggesting the Inspector Committee member had anything to do with the amendment...I thought that up on my own. :D

[Richard Rushing]

Quote from Mike B: "The chances of any legal challenge to the amendment are practically nil so all this bitching and moaning is just that."
____________

I believe that statement hits the nail on the head...

Rich

[George Koehl]

Richard- Sorry about the outburst
Frustration got the best of me
--
Refocused
Ready to get constructive


New Board for Texas Inspectors
Texas Inspectors Coalition (http://tic.intexinspections.com/)

Set up to help Texas Inspectors discuss and share information about the SOP and Inspecting in Texas.
When you got the entire state government against you, you gotta band together.

Members only section is off limits to vendors and general public
So Inspectors can talk openly