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  1. #1
    William Brady's Avatar
    William Brady Guest

    Default Home Inspector Workers Compensation Coverage

    Today I had a conversation with the largest Real Estate Company in this city. They asked the following questions that came up in there advisory board meeting.

    We want to screen inspectors to make sure that they, the RE Firm is providing a list to there clients of qualified inspectors. For example they started off by saying we think we want to use ASHI as a requirement for the list. I am a NAHI member who took and passed the National Inspector ASHI test several years ago. I asked why they thought ASHI had the only qualified inspectors. Any thoughts ???? Please lets not get into the ASHI Vs NAHI and InterNachi thing if we can. Thanks.

    Second question is this. Who is protecting the seller in the event an inspector falls off a roof and sustains serious injury. What prevents that inspector from suing the seller. They think that if the inspector has Workers Comp insurance or if the inspector signs a waver saying they will not sue the seller that may surf ice. Wavers are used in the course of business in a Real Estate transaction all the time. I advised them that I would be putting these questions out to you and report back to them on what you think.

    New Mexico is not a license state so you need to take that out of the mix. Inspecting in NYS (licensed state) and now here I have never carried Workers Comp and do not have any employees. I called my carrier and GL insurance covers damage I do to someones home and E&O for mistakes. DO they have a real concern in asking this question. Has anyone been confronted with a situation like this? I need good documentation and reason one way or the other. Thanks for thinking about this. I am sure I am not covering all the good questions that may come up in the post from all of you.

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  2. #2
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    Default Re: Home Inspector Workers Compensation Coverage

    Quote Originally Posted by William Brady View Post
    Today I had a conversation with the largest Real Estate Company in this city. They asked the following questions that came up in there advisory board meeting.

    We want to screen inspectors to make sure that they, the RE Firm is providing a list to there clients of qualified inspectors. For example they started off by saying we think we want to use ASHI as a requirement for the list. I am a NAHI member who took and passed the National Inspector ASHI test several years ago. I asked why they thought ASHI had the only qualified inspectors. Any thoughts ???? Please lets not get into the ASHI Vs NAHI and InterNachi thing if we can. Thanks.
    You should ask them why they felt they they needed ASHI as a requirement. Most likely because ASHI has been around the longest and has a pretty good PR machine that touts their members, so this is all they know.

    Second question is this. Who is protecting the seller in the event an inspector falls off a roof and sustains serious injury. What prevents that inspector from suing the seller.
    Nothing can prevent this. Same as if the RE agent falls down the stairs of the home while showing it to a prospective buyer, or even the agents client falling down the stairs. This is why you have homeowners insurance, to protect you the owner.

    It is the same with any contractor that comes to their home. If the HVAC guy falls through the attic, the owner is on the hook. But, this is where a contractors GL coverage comes into play. The contractors insurance company works with the owners insurance company to take care of any problems.

    They think that if the inspector has Workers Comp insurance or if the inspector signs a waver saying they will not sue the seller that may surf ice. Wavers are used in the course of business in a Real Estate transaction all the time. I advised them that I would be putting these questions out to you and report back to them on what you think.
    Workers Comp insurance in many states is not available to single employee business, like most home inspectors. I can not get it in my state as a solo inspector. Workers Comp would not protect the owner of a home, but it would help the employee with bills if they were injured while on the job. A waiver will not stop anyone from suing the pants off ya, if that is what they have in mind.

    New Mexico is not a license state so you need to take that out of the mix. Inspecting in NYS (licensed state) and now here I have never carried Workers Comp and do not have any employees. I called my carrier and GL insurance covers damage I do to someones home and E&O for mistakes. DO they have a real concern in asking this question. Has anyone been confronted with a situation like this? I need good documentation and reason one way or the other. Thanks for thinking about this. I am sure I am not covering all the good questions that may come up in the post from all of you.
    Bottom line is that no matter what type of insurance a person has and no matter what a person signs, you can still be named in a lawsuit. They might not win, but it will still cost you to defend yourself.

    Scott Patterson, ACI
    Spring Hill, TN
    www.traceinspections.com

  3. #3
    chris mcintyre's Avatar
    chris mcintyre Guest

    Default Re: Home Inspector Workers Compensation Coverage

    William, or is it Bill? ,

    I do not claim to be an insurance expert, so FWIW workers comp is for the workers/employees and (in my case) the owner of the company is exempt and can not be covered, this is why I have a disability policy. My understanding is that if you are Incorporated (the company is its own entity) that you can get WC coverage, but if you are a sole proprietor or an llc you are exempt.

    Many individual sub contractors have a "ghost policy" which would protect the contractor/homeowner from being sued but would not pay out if injured.

    Again this is my interpretation of WC coverage, if I am wrong I have no doubt I will be corrected.


  4. #4
    William Brady's Avatar
    William Brady Guest

    Default Re: Home Inspector Workers Compensation Coverage

    Thanks so far for the response. I found out something today that I did not know. I the case of a LLC or INC when you are the only one and have no employees or less than 3. You can elect not to carry W/C on yourself but since you are an officer of the LLC or whatever it is you can get the W/C on yourself. Now thats is how it is in New Mexico anyway.

    Scott I agree that homeowners insurance is there to protect yourself from prople who trip and fall on your property thats a given in my mind. I think they are looking for some kind of protection for the sellers anyway. I know these folks and some of them have been to my home from time to time. It is not, in this case that they are talking to one of us and trying to get some advantage. In this case I know that they are really trying to accomplish something and to provide clients with the best possible inspector and the insurance thing has just come into the discussion. I would advise that you check your state and see if you can cover yourself in the way I can do it here. Back in June of last year I took a fall off a ladder and was laid up fr 5 months so I wish I had it in place prior to that happening. I used my medical to cover but not lost wages or earnings.

    Regarding the W/C info above I got it directly from the State W/C office here in town so I know it's good info at least for this state.

    The waver issue is another thing. Here in NM brokers do wavers for everything that are included in the whole sales package. I know that these wavers are tested in court from time to time but if done well they stand for the most part. They are looking for some way to say to us "sign this so you don't sue the seller. I guess you could decide not to work under that situation. Or you can sign and use your own medical coverage to handle the needs after an accident. Or amybe get the W/C and provide that info to the brokers. Cost of doing business I guess you could say that. Maybe the cost of HI's goes up slightly.

    I like what you have said already and would appreciate anything else that come to mind.

    Bill


  5. #5
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    Default Re: Home Inspector Workers Compensation Coverage

    On the WC question.

    For several years now, I have used a payroll service for the guys that work for me. The payroll service pays my employees, the taxes and the WC. I pay the payroll service a fee to do this.
    A few years ago I fell through the ceiling on one of my properties. I was not hurt, but it scared me. I called the payroll service and had them add me to the payroll. I was then covered by WC. Since then there have been a few times that someone has asked for my WC policy. I call the payroll company and they send me a copy of the WC certificate.

    ' correct a wise man and you gain a friend... correct a fool and he'll bloody your nose'.

  6. #6
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    Default Re: Home Inspector Workers Compensation Coverage

    What is the approximate cost to add yourself onto the WC? That might be a good alternative to a disability policy.

    Jim Robinson
    New Mexico, USA

  7. #7
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    Default Re: Home Inspector Workers Compensation Coverage

    "What is the approximate cost to add yourself onto the WC? "

    I pay the payroll company 33% over cost of the payroll.
    Out of that 33%, the payroll company pays all WC, unemploiment, and their share of SSI, plus they do and file all the paper work, and send W2s at the end of the year.

    ' correct a wise man and you gain a friend... correct a fool and he'll bloody your nose'.

  8. #8
    William Brady's Avatar
    William Brady Guest

    Default Re: Home Inspector Workers Compensation Coverage

    I do not know the cost but I am sure you can contact an agent in Santa Fe and they will give you a quote. I don't know if it is a good way to go instead of a disability policy but who knows until you ask.

    rick as far as I know now and you probably know this already if you have three or more employed then you have to have WC for them. As I said you can choose not to have it on yourself but as an officer in the company lets say and LLC with less than three you can get the coverage for yourself. How this all works out in terms of dollars I do not know. The price of E&O plus GL then to add WC it just sounds like a lot.

    Of course realtors do not realize the price we pay to do this work. They pay around $300.00 a year for E&O. No comparision to my and I am sure your insurance costs.


  9. #9
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    Default Re: Home Inspector Workers Compensation Coverage

    Quote Originally Posted by William Brady View Post
    Back in June of last year I took a fall off a ladder and was laid up fr 5 months so I wish I had it in place prior to that happening. I used my medical to cover but not lost wages or earnings.
    Get a disability policy that covers self employed. It is likely much cheaper than workers comp and you get to set the limits. I have a 30 day elimination period and an income that would just about keep my head above water if I am disabled for any reason, including an on the job injury. Just prudent if you are a one man show as most HI.

    I would imagine the reason for the broker setting standards of HI they refer has more to do with limiting their liability than their customers. The home owners policy will protect the home owner but not the broker. Only recommending a higher standard of HI (ANY exclusionary standard) will play well in court in case they are sued, which is also the reason for providing a list, not just one inspector. It would not matter what standard they choose, just so long as it appears that they have some sort of standard that they apply. At least that is the way I read it.

    Last edited by Jim Luttrall; 03-17-2010 at 08:33 PM.
    Jim Luttrall
    www.MrInspector.net
    Plano, Texas

  10. #10
    William Brady's Avatar
    William Brady Guest

    Default Re: Home Inspector Workers Compensation Coverage

    Thank you Jim I like the use of a Standard for HI. It really does not matter as long as they use the same rules for all. Since they asked, I am going to advise them to factor in the National Test that ASHI or NAHI and others use as a Standard. The big thing here is not having to be licensed. Couple of years ago just after I moved down from the North East a friend showed me her HI report. It was one page hand written and some boxes checked. Now that was just three years ago. Lots of the guys in town are well trained now (AHIT for example) but some are still hanging around working relationships developed over the years. Thanks again.


  11. #11
    Join Date
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    Default Re: Home Inspector Workers Compensation Coverage

    William, welcome to the jungle.

    I was kind of interested in the WC angle, because I have a PC (pre-existing condition) that most disability policies won't cover, so I thought I would look into that angle. Probably won't be worth it either, but I'll take a look at it.

    Jim Robinson
    New Mexico, USA

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