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WA State HI licensing

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I'm new to forum and my have missed this somewhere in archives so here goes

Question: probably for Mike O'Handley ?...

(1)Why no E&O insurance requirement in Bill (or bond similar to SPI requirements)

(2)and is a limit on liability going to be pursued by board or is it past that point??


Got word that on Friday (from Committee Legal Counsel,) the mold issue has been struck from the Bill and the Long Distance learning requirement trimmed to 20 of the 120 hours of classroom learning to get a license.

This is good.... especially the mold issue

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Hi Jerry,

I don't know for certain why Senator Spanel didn't have an E & O requirement in the original bill that became law but I can tell you that when WHILAG - the coalition that fought her for two years - was deliberating what to push for in the bill and what to get eliminated, the group had quite a debate about E & O and ultimately voted in favor of it being left out and allowing business owners to decide on their own whether they feel it is necessary or not.

Personally, I think forcing an E & O policy on folks doesn't make sense because most deductibles equal just about what the limit is for small claims court and because most "claims" are at teh small claims court level so an insurance company won't pay them anyway - the inspector must if it's determined that he's screwed up. Besides, at what you pay for an E & O policy, if you're a good inspector and don't have any claims at all for, say, 10 years, that's about $40,000 that you've essentially thrown away. Even if you get one $10,000 claim, you'll still have to pay the $5k deductible, thus pushing the cost of the iinsurance over that decade to about $45k and now they'll raise your rates.

Lots of other professions are doing fine without E & O and nobody calls those professional irresponsible business persons, why is it that everyone seems to think that home inspectors are any different than other business people and one must have additional protections? Guess you can see which way I voted at WHILAG.

I once had a lady make a frivolous claim against me. I investigated, discovered that it was completely bogus, and then I reported it to my E & O carrier, figuring that they'd tell her to take a hike and I'd be home free. They agreed with me 100%, refused to give her a dime, and then promptly billed me for the entire deductible. "What kind of bullshit is this," I asked. "Oh, that's the way it works. Didn't you know?" was the answer that came back. In otherwords, they made a big chunk of money on my phone call and my bank account became shorter by the amount of the deductible.

That's when I figured out that E & O is nothing but a scam. Oh sure, a mandatory E & O requirement will force a few folks out of the business, so there aren't as many competitors, but it won't do a whole lot for most folks who've got a complaint with an inspector.

Anyway, like I said, you'll have to ask Senator Spanel.

There is nothing preventing you from placing a limit of liability in your contract if you want to; it's been upheld in this state by some judges and hasn't by others. Talk to your lawyer.

One thing you do need to understand is that a limit of liability isn't going to protect you if your contract looks like a one-sided contract of adhesion that doesn't give the consumer any other alternative except to agree to a refund. That will only end up landing you in a courtroom being sued. You'll stand there protesting the fact that you're in court, because you have a LoL in your contract, and the judge will point out that you're there because you didn't give the customer any other option and it will cost you one way or the other.



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