Thread: Wanted: 4-point & Wind Mitigation Inspection Agreement(s).

I am renewing my HI liability and E&O insurance policy. One of the application questions is "Is a pre-inspection agreement/contract used 100% of the time?". I said not for wind mitigation and 4-point inspections. They want me to use one for these inspections too. Does anyone have inspection agreements for wind mitigation and 4-point inspections that they could share? Also, does anyone have a addendum that can be used with the standard NACHI home inspection agreement for when I do these inspections along with a home inspection?

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Originally Posted by Bob Bassett

I am renewing my HI liability and E&O insurance policy. One of the application questions is "Is a pre-inspection agreement/contract used 100% of the time?". I said not for wind mitigation and 4-point inspections. They want me to use one for these inspections too. Does anyone have inspection agreements for wind mitigation and 4-point inspections that they could share? Also, does anyone have a addendum that can be used with the standard NACHI home inspection agreement for when I do these inspections along with a home inspection?

I hope that you are not using a "standard" agreement/contract. Contracts need to be written pretty much for each individual state. I know that FL has some unique laws and proven case law that impacts contracts. You might want to invest a few hundred dollars and have a contract attorney review what you are using.

As for a 4-Point or Wind Mit contract, why not change few words in your current contract and make it work for those. I bet that it would not be all that difficult. Then have an attorney bless them.

Thanks for the reply Scott. I do use the standard NACHI inspection agreement for my home inspections in Florida and figured it was fine. Maybe I should have it reviewed by an attorney.

Does anyone have a standard NACHI offspring standard inspection agreement that has been blessed by an attorney for use in Florida? Do you use an inspection agreement which would also handle 4-point and wind mitigation inspections that you could share?

Bob,
Besides being requested by your insurer, what would be the purpose of obtaining an agreement with the homeowner.The 4 Points are ordered by the insurer and only inure to the insurer's benefit for underwriting the risk. The homeowner derives no benefit from the inspection other than the privilege of paying for the inspection so his/her insurer will write or renew the policy. If there was ever an issue with the report, in all likiehood it would be between the insurer and the HI not the homeowner.

Wind Mits are similar in that they are prepared for the insurer on the approved 1802 form (as are the Nachi 4 Point forms by Citizens) thus IF any issues did arise regarding the findings of the inspection checked off on the 1802 they most likely would be raised by the insurer and not the homeowner.

I would be interested if anyone has additional thoughts on this area. The homeowner who paid for these inspections would be the client even thought the inspection request came from the insurance agent but any issues that may arise would be raised by the insurer and not the client. Thus the question remains, why is an agreement required between the HI and the homeowner?

You raise a good point that the insurance company is requesting the 4-point or mitigation inspection. However, the homeowner or prospective homeowner is the one who is requesting the report from me and is the one paying for it. I certainly have a responsibility to him, as well as the insurance company, to do a competent job, etc. As with a typical home inspection, if for some reason he feels I didn't do a competent job and he should have gotten better rates or got dropped by the carrier, or I missed a safety issue that later caused him damage, he may be able to argue I should have told him the inspection was not the same as a home inspection, and that I should have let him know that in the form of an agreement. In any case, I want to make sure I'm covered and my insurance company says I need to have an inspection agreement 100% of the time.

I know most inspectors don't have inspection agreement for these inspections. I wonder if any inspectors use an inspection agreement for them. I wonder if anyone has ever been sued in reference to one of these type inspections.

Bob,
I realize my last post did not answer your question. Having spent 35 years in the Claims and Litigation end of the Insurance Industry including 6 years with Morgan & Morgan ( For The People) I can offer the following. The reason your carrier wants an agreement in place is to simply limit your liability in the event of a claim being made against you under the policy. In turn, the agreement would further limit their monetary exposure on any particular claim. Don't forget most E&O policies carry a hefty deductible which are also applied towards defense costs.

If I were you, I would contact your agent and ask them to have the carrier or their office provide you with a copy of the agreement they are looking to see in place on a 4 Point and Wind MIT inspection. The Nachi agreement or the one you use for Home Inspections addresses much too more than what a Wind MIT and 4 Point inspection involves thus modifying such would probably require some legal assistance. Therefore throw it back at the carrier as to what specifically they want in place before expending any money for legal advice. I would be interested in seeing any agreements they provide to you if you don't mind. My email address is: bob@onthegulfhomeinspectionservices.com
Thanks.

What you say makes sense. I asked them if they had such agreements they could share and they didn't have any to offer. I may ask them again. I sure wish someone had one to offer. If I get anything that looks reasonable I'll forward it on to you. Thanks for your insight and interest.

I am not surprised, I am sure the Underwriters for your insurer do not even know what a 4 Point is. They know what HI's are and are just applying the same principles knowing there are pre inspect agreements for the HI's.

I would still place the onus back on your agent to provide you with an example of what they want. I assume this is a new requirement of their's since you had the insurance previously.

Call Schuyler Hellings of CH Ins Brokerage, he writes E&O policies for Nachi members, he should be able to provide you with further insight. His number is 315 552-5343.