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  1. When you say private practices, I'm not sure what you mean. Could you explain? As for the W2 comment, depending on your state, the inspection companies for whom you work may still be required to or have the option to cover you as an independent contractor under their existing workers' comp policies.
  2. @Jim Katen: Great question. Since workers' compensation insurance is regulated by individual states, sole proprietorship coverage options and rules vary by state. In many states, sole proprietors are exempt from workers' comp requirements but may choose to purchase coverage. Your state of Oregon is one of those states in which you are not required to purchase coverage but may if you want to. You can find more info on Oregon's workers' comp laws here. Other states allow sole proprietors to opt-out of workers' comp coverage if they don't have employees. (i.e. Arizona, California) Also, there are a handful of states in which sole proprietors are exempt. To find out exactly what the regulations are for your state, I'd recommend talking to an insurance broker or going to your state's government website. NFIB has good summaries of requirements and links to the government websites here. @Tom Raymond: Not sure who's providing you with that workers' comp info, but it's incorrect. Regardless of whether you're an officer of a corporation or a standard employee, work-related injuries or illnesses are eligible for workers' comp coverage. If you were injured unloading your truck in relation to your home inspection business, your workers' comp claim would be covered. Even if your workers' comp provider mis-categorized you as a clerical/admin employee, workers' comp is a no-fault insurance. That means that it would be the insurance company's job to cover the claim anyway and, if necessary, bill you whatever difference in cost to re-categorize you properly. The only reason I could see a workers' comp claim regarding a truck unload being denied would be due to a pre-existing condition. If, for example, you have a history of back injuries and problems, and then you strain your back unloading the truck, the claim could get denied because of your past medical issues. However, your health insurance should then pick it up so long as you don't have any prohibitive exclusions for pre-existing conditions within your health insurance coverage. In regards to your concern about your workers' comp and health insurance competing to cover (or not cover) claims, they're meant to address different issues. Any injury/illness on/from the job--so long as it isn't a pre-existing condition--should go to your workers' comp policy. All other injuries/illnesses that happen outside of your job--including pre-existing conditions--go to your health insurance policy. Each policy has separate responsibilities, so as long as you're sending your claims to the right place, there shouldn't be a coverage problem. Hope that clarifies some of your concerns. If you want additional insight into how workers' comp works in New York State, I recommend checking out the WC Board's website here.
  3. Good point. Lacking expertise, training, and communication skills definitely increases your risk. It's interesting to note that, of the claims we received in 2017, 80% of them were "meritless," meaning the technical inspection was fine. A lot of those claims came down to communication issues, where the client didn't understand the scope of the inspection or the inspector's findings. So, there's definitely a lot to be said about risk tolerance and setting expectations.
  4. Hi TIJ Readers! Here's a preview of our latest article, which covers the ins and outs of workers' comp for home inspectors. Enjoy! Stephanie Several months ago, we were reviewing a home inspector's workers' compensation policy. Unbeknownst to that home inspector, their insurance carrier wasn't familiar with the property inspection industry. Despite their lack of experience in the inspection space, the carrier didn't want to turn the home inspector away. Instead, the insurance company categorized (or grouped) the home inspector in what they perceived to be the closest type of business they already insured: window blind installation. With a window blind installer's workers' comp policy, the home inspection business lacked coverage for many of the unique risks their employees faced. For example, since there's no need for a window installer to mount a roof, the home inspection company didn't have coverage in case their employees fell off an inspection property's roof. Thus, by pairing up with a workers' compensation provider unfamiliar with their business, the home inspection company's needs were not being met. What is workers' compensation insurance? Since 2050 B.C., governments have granted sick and injured laborers payment after workplace accidents. Ancient Greek, Roman, Arab, and Chinese law all dictated precise payments for both bodily impairments and disabilities. Thus, their legislation laid the foundation for the workers' compensation insurance we have today. (For more on workers' comp's history, see Gregory P. Guyton's "A Brief History of Workers' Compensation" or AmTrust Financial's summary "The History of Workers' Compensation Insurance".) Workers' compensation insurance provides employees who suffer from work-related injuries or diseases with access to medical and wage benefits. Unlike general liability (GL) insurance, which covers inspection-related bodily injury and property damage claims for non-employees, workers' compensation looks out for people who work for your company. By covering job-related injury and illness costs, workers' comp protects both employees and employers. Employees work under less financial risk knowing they're protected on the job. Additionally, employers limit their liability and deter litigation. Recognizing the need for workers' comp in the home inspection industry, we launched our own workers' compensation insurance program in June 2019. In this article, we go over some of the common questions inspectors do (and should!) ask when shopping for a workers' comp policy. We hope that the information outlined here can help you make an educated workers' comp purchase with us or another provider. [READ NOW]
  5. Since a lot has changed since 2011, I thought this question deserved an update. Pretty much every home inspection insurance provider requires home inspectors get their pre-inspection agreements signed prior to the inspection. To learn a bit more on why it has to be signed ahead of time, and to get some tips on how to get it signed prior to the job, I recommend reading our article "Behind the 'Pre' in Pre-Inspection Agreement" here. Keep in mind that many states accept real estate agent signatures via the limited power of attorney. You can read more about how that works in our article "Who can sign my pre-inspection agreement?" here. Good luck!
  6. Old post but I think I can add some value. State mandates aside, how much insurance you purchase is up to your risk tolerance: how much you’re willing to leave to chance versus how much you want to protect yourself. Examples of someone with a high risk tolerance: Someone who carries no insurance. Someone who just carries one type of insurance, like just general liability. Someone who chooses low insurance limits (i.e. $100,000 / $100,000). Someone who chooses a high deductible (i.e. $5,000). Someone who doesn't carry endorsements for the additional services they perform. (i.e. They perform mold tests but don't carry mold coverage.) Someone who purchases a heavily sublimited insurance policy. Examples of someone with a low risk tolerance: Someone who carries high insurance limits (i.e. $1,000,000 / $2,000,000). Someone who chooses a low deductible (i.e. $1,500). Someone who carries endorsement for all ancillary inspection services, regardless of whether they perform those services. (i.e. They don't perform mold testing but they carry mold coverage anyway.) Someone who purchases an insurance policy with little to no sublimits. Obviously, insurance companies like us are always going to advocate carrying more insurance rather than less. But ultimately, it's up to your personal risk tolerance. Some educational resources on choosing insurance coverage: E&O vs GL Insurance: What they are and why we recommend both 3 Ways Your Deductible Determines What You Spend and When 4 Ways to (Re)Choose Your Insurance Limits As for the concept of insurance co-ops, there are a handful of inspection franchises who use a similar method: they add all of the inspectors in their franchise to one policy. The only issue is that claims history is still a factor that determines what to charge the groups. So often, these groups end up being just as expensive or more expensive.
  7. Old post but worth a reply since no one in the insurance industry wrote a response back in 2014. In the last five years, we've seen a fair number of claims resulting from report passing or third-party reliance. In Northern California in particular, it's pretty common for home inspectors to perform inspection for sellers and for those sellers to provide the report to potential buyers. Ultimately, anyone can sue you for any reason. However, there are some things you can do to mitigate report passing and give yourself some ammo when unintentional reporting passing happens. Some general recommendations: Teach the real estate agents you work with that it's important to get a new inspection every time there's a new buyer⁠—regardless of what the findings were during your initial inspector. Make sure you really spell out the limitations of your visual, non-invasive inspection verbally and in writing to your clients, agents, and anyone interested in acquiring your reports. Understanding that inspections are snapshots in time will help them recognize that report passing isn't reliable. If inspecting for a seller, be sure your pre-inspection agreement includes third-party reliance language that requires whomever the seller shares the agreement with (i.e. a potential home buyer) to execute an inspection review agreement. On the first or second page of your inspection report, we recommend prominently stating that third-party reliance is prohibited without a signed inspection review agreement. Also include instructions on how clients can request inspection review. As always, check in with your attorney or insurance provider to make sure that any of the risk management techniques you use, including the ones recommended above, make sense for your state. Hope that helps!
  8. Old post but it's worth responding to since the market has changed quite a bit.... Most home inspection insurance providers nowadays include general liability (GL) with their errors and omissions (E&O) quotes at no additional premium charges. As @hausdok described earlier, providers typically write the same limits for the two types of coverage. (Example: If you purchase $1,000,000 / $1,000,000 in E&O, providers will usually write you $1,000,000 / $1,000,000 in GL.) The limits you choose are one of several factors underwriters use to determine your rate. (For tips on choosing insurance limits, I recommend reading our article "4 Ways to (Re)Choose Your Limits" here.) As for @Marc's comment about buying GL-only policies being near impossible, that's still pretty true in the home inspection insurance space. However, with more states passing GL-only laws, some providers are making exceptions, so I'd suggest speaking with your preferred provider to see if they'll write just GL for you. Otherwise, local insurance providers can be a good option. Just be careful purchasing GL-only coverage from someone unfamiliar with the property inspection industry because they may write in exclusions you don't want to have. (i.e. No mounting roofs. No climbing ladders.) For help understanding the differences between E&O and GL and why insurance specialists in the home inspection space recommend carrying both, I recommend reading this article. Hope future readers find those updates relevant and useful!
  9. Hi TIJ Readers! For the first article of the month, we really wanted to address an industry pain point: fear of the insurance company. Most of the time, if inspectors delay or avoid reporting complaints, it's because they're afraid that the insurance company will mishandle them and/or up their premiums. But, there are lots of reasons why reporting claims early is important?and many of those reasons involve home inspectors saving money. We hope to shed some light on a few of those benefits. Enjoy! Stephanie How To Save Money By Reporting Claims Early Let's face it: Insurance companies have a bad reputation. Most people don't trust insurance carriers (let alone like them). And, while many people learn this distrust from others, some learn it from bad experiences with the insurance companies themselves. With a culture of skepticism surrounding insurers, it isn't surprising why home inspectors don't want to report complaints to their providers before they turn into claims. After all, isn't free legal help with no effect to your premiums too good to be true? Not here at InspectorPro. In fact, not only do most policies come with free pre-claims assistance, but most policies also have a Waiver of Deductible Endorsement. In Part 2 of our deductible discount series, we break down how Waiver of Deductible Endorsements like the one we offer here at InspectorPro can save you money. (For those of you who missed Part 1, you can check it out here.) You can save money by reporting claims early. When you report a claim, the most you will owe your insurance carrier is your deductible. However, there are ways to pay less. You can receive discounts by reporting your claims promptly. In a recent article for the Insurance Risk Management Institute (IRMI), risk manager Christopher Mandel explained the importance of reporting claims early: "All insurance claims must be 'reported' to be investigated and resolved. The timing of this most important first step in the claim administration process is critical as it is well established that the more quickly claims are reported, the more likely it is that all relevant evidence can be secured, and the more efficiently the claim will be resolved. And, often, doing so often leads to lower claim costs." Since timing can play a pivotal role in claims handling, many insurance companies offer early reporting incentives in the form of deductible waiver endorsements of up to 50 percent off to encourage insureds to quickly report potential claims to the insurance company. Let's go over some of the key characteristics of early reporting incentives. [READ MORE]
  10. If you're only looking for basic GL, the same insurance carriers you may go through for your other insurance needs--like Liberty Mutual--can work. The reasons you might consider going with an insurance provider that specializes in home inspectors include: Better (and often cheaper) claims handling Risk management services, like pre-claims assistance and education Better E&O products for home inspectors (if you're thinking of getting both in the future) Ultimately, it depends on your risk tolerance, or how much you're willing to leave up to chance.
  11. Hi @Jerry Simon! (And everyone else who has posted on this topic.) Despite this being an older post, I thought I'd weigh in since a lot has changed in the home inspection insurance space since late 2017. It's true that most insurance providers, including InspectorPro, will advise clients to purchase both errors and omissions (E&O) and general liability (GL) coverage together. That's because the vast majority of insurance claims in the home inspection space are E&O claims. (And by vast majority, I mean that, for many carriers, over 90% of all property inspection claims are E&O-related.) (You can read more about how the two coverage types here: http://ipro.blog/TIJ-eo-gl.) However, because some states (like Arkansas, Florida, Indiana, Maryland, New York, Ohio, Oklahoma, Oregon, Virginia, and West Virginia) only require GL, more insurance providers that specialize in home inspectors are offering GL-only policies. Off the top of my head, some home inspection insurance providers that advertise GL-only insurance policies include: us (InspectorPro Insurance), CH Insurance, Elite MGA, Lockton Affinity, and RiskPro Insurance Agency, LLC. I can't attest to how all of the above insurance companies write their general liability policies. However, I can say that InspectorPro does not write policies with standard annual rate increases like what you're describing over at State Farm. Most home inspection insurance providers should rate both GL-only policies and E&O/GL policies based on claims history, experience, exposure, coverage, and geographic region. Last thought: Say you're buying a GL-only policy with the intent of upgrading to an E&O and GL policy in the future. We'd recommend pairing up with whichever insurance provider you'd like to work with in the future for an easier transition. So, even when you're shopping for just GL, we recommend looking into benefits like pre-claims assistance, deductible discounts, lack of sublimits, etc. so you're in a good place when you switch. Hope that information is helpful for anyone shopping GL policies in 2019!
  12. Hi TIJ Readers! When most insurance policies are pretty much tomes, it's tough to catch all the details. And those details can make a huge difference. In our latest article, we talk about one of the deductible discounts you can find in some home inspection insurance policies and how it works so you don't miss out on potential savings. Enjoy! Stephanie From our decade of claims data, we know that the majority of home inspectors receive at least one claim in their career. And, when they do, it never feels great?particularly when that claim is meritless as about 80 percent of home inspection claims are. In his recent article, home inspector Randy Sipe described the feeling of a first claim as "the most emotional roller coaster ride of your professional life," primarily due to the financial worries associated with claims. As Sipe pointed out, the first step toward peace of mind is carrying errors and omissions (E&O) and general liability (GL) insurance. But your protection doesn't have to stop there. Some insurance providers provide deductible discounts to home inspectors based on how infrequently they receive claims and on how quickly they report allegations. In Part 1 of our series, we go over how you can make half of your insurance deductible disappear. A diminishing deductible endorsement?also referred to as a reducing, depreciating, or disappearing deductible?rewards you for your consecutive years with your current insurance provider and without claims. Below, we address some key characteristics: Some diminishing deductible endorsements only affect your E&O coverage. In home inspection insurance, most policies come with separate E&O and general liability deductibles. Often, home inspectors have the opportunity to choose the E&O deductible that's right for them. (InspectorPro offers E&O deductibles of $1,500, $2,500, and $5,000.) On the other hand, insurance carriers typically determine the general liability deductible amount. (Typically, InspectorPro's GL deductibles are $1,000.) Since many carriers standardize most GL deductibles for home inspectors based on their own risk calculations, some diminishing deductibles only affect your E&O coverage, including ours. In order to confirm which deductible(s) your endorsement affects, read the endorsement form in your insurance policy. Most diminishing deductible endorsements have a standard and a maximum reduction. Is it possible to reduce your deductible to $0? Or to reduce your deductible by a larger percentage one year than the next? Not with a diminishing deductible endorsement. Most (if not, all) diminishing deductible endorsements have a standard and a maximum reduction amount. With InspectorPro, for each consecutive policy period that you do not have a claim, your E&O deductible will be reduced by 10 percent subject to a maximum reduction of 50 percent. So, each of your first five consecutive years are subject to a 10 percent reduction. And, even if you go 10 years consecutive years without a claim, the most your deductible will reduce is 50 percent. The following graph illustrates your potential diminishing deductibles based on number of consecutive years without claims and E&O deductible: Keep in mind that different insurance companies can offer different decreases. So, be sure to review your insurance policy or consult your insurance broker to determine a) if your current coverage offers a diminishing deductible and b) how much the deductible can reduce each year. [READ MORE]
  13. Hey TIJ Readers! Long time since I last posted. National Home Inspection Month was a busy one for us with our funny home inspection story contest and our first-ever guest-written article. (You can read the top stories from the contest here and Randy's article here.) Since so many of our articles focus on errors and omissions issues, we decided it was time to share a story from our archives that addressed a general liability problem. What makes this one interesting, too, is that it addresses not only the power of pre-claims assistance but the power of a well-written report. You can read the full story on our website here. Or, feel free to check out that preview below. Have a great rest of your inspection week! Stephanie How one inspection report saved thousands of dollars The following is a real home inspector general liability pre-claim from our archives. The inspector has given us permission to reveal his identity and to use direct quotes from our post-pre-claim interview. Pre-claims assistance is exactly what it sounds like: It's free help responding to unhappy clients in a way that may prevent said clients from making any demands. Here at InspectorPro, we define a claim as a written demand for money, which Latham had yet to receive. However, for readers who don't insure with us yet, do keep in mind that every insurance company is unique and definitions can vary. Be sure to read a copy of your policy to be sure of how your company defines a claim. To learn more about pre-claims assistance, read this recent article. The cracked tile While performing a routine home inspection in Oregon, Aaron Latham of Sunrise Inspection, Inc. made what he described as "a very rookie mistake." He set a round, metal flashlight on top of the property's kitchen island. As round objects do, the flashlight rolled off the island. It hit the ground and put a hairline crack in one of the tiles. Realizing that he'd made a mistake, Latham documented both the existing tiles that were cracked and the one tile he cracked with his flashlight in his inspection report. Shortly after purchasing the house?for several thousand dollars less than the asking price due to inspection findings, according to the real estate agent?the agent called about the tile. Latham agreed that he did, in fact, damage one tile, and asked the agent to obtain an estimate. At the time, Latham guessed that they'd quote about $100. "Well, here's the issue," the agent said. "We can't find tile that matches the existing tile, and the seller didn't have any spare tile on hand. What we were hoping is that you would replace the entire floor." That's when Latham called our pre-claims assistance team. [READ MORE]
  14. Sorry for taking a while to get to these comments! I've been on the road quite a bit this month, so I haven't been as diligent about checking the forum! Great point! While I try to make the info in the articles as generic as possible so that it can apply to as many insurance carriers as possible, every insurer has a different set of rules. So, it's important that inspectors know what their insurance companies say about contracts and other policies. In addition, what works for your insurer may not work for your state or for other laws. A good example of this is independent contractors. At InspectorPro, we don't care if you 1099 your workers so long as they abide by the same standards. However, the IRS does! We've always required signed pre-inspection agreements, but we started making it more apparent in our paperwork around 2016. Back then, we probably got at least one call a day from inspectors that were upset it was a requirement. Now, we get maybe one call every other week about it. However, we still get plenty of claims in which the inspectors didn't get the agreement signed ahead of time. I think some of them are residual from back when we weren't banging everyone over the head about pre-inspection agreements. Then, there are others that just cave to really pushy clients or agents. In my experience, the inspectors that don't get their agreements signed are rarely doing it because they're old school or arrogant or misinformed. It's usually guys who get tired of fighting an aggressive client or agent and say they'll make an exception just this one time.
  15. Anddd I know I'm replying six months later, but in case I can still be of help to you or another TIJ reader.... @RK52: Full disclosure: I work for InspectorPro, so I AM biased. However, I hope to give you a factual rather than a salesy response so you can make an educated purchasing decision. We actually wrote an article about three important differentiators to examine when comparing insurance providers. You can find the article in the ASHI Reporter here. Now, in addressing how we compare specifically, I'd say that we at InspectorPro stand out from our competitors with our... Pre-claims assistance: No one does it like we do. We don't charge--no cost per claim, no increase to premiums. It's just free with your policy. And it's successful. Our pre-claims team stifles 85 percent of complaints before they turn into claims. Read more about how we do pre-claims assistance here. Customer service: Because the home inspection industry is a bit niche, most insurance providers don't have a team dedicated to home inspectors alone. One of the common reasons inspectors switch to us at renewal is pretty simple: We answer the phone and our emails. And we know what we're talking about, so we can be a resource for insurance, claims, and risk management questions. (Don't get me started on our risk management education. 😉) Our customer service seems to be the main talking point in our Facebook reviews. (Read them here.) Comprehensive coverage: If you read the shopping insurance article I mentioned earlier, it talks about cheap tricks that some insurance companies will play to seem as if they have lower rates. We don't do sublimits. And we don't do self-insured retentions. You get what you pay for. OREP does offer medical plans, and you don't need to carry OREP's home inspection insurance (E&O or GL) to qualify for their health insurance. For California residents, they offer plans through three carriers: Kaiser, Allied National, and United Healthcare. They also offer short-term medical coverage in a few states for people in between jobs or waiting for coverage through Allied National. Get info on OREP's medical coverage here. Now, what I don't know is whether there are any discounts associated with OREP's medical coverage. For example, if you got a quote through OREP for Kaiser, would it be cheaper? Or would you get the same rate if you went straight to Kaiser? You may have to apply to find out. Hope my belated insights help! Stephanie
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