Understanding Insurance Limits for Errors and Omissions

Insurance is a safety net that can relieve some of the stress of everyday life. Although no one wants to imagine or anticipate an emergency occurring, the reality is that you never know when you will find yourself in a tough situation. As a property inspector, there are often unknown factors you have to contend with, so it is important to feel confident. When it comes to covering yourself and protecting your business, errors and omissions insurance for home inspectors can give you peace of mind.  

Errors and omissions insurance is particularly important in the business of real estate inspection. In fact, many inspectors refuse to work without this specific type of coverage because it can open them up to potential problems later on. Since inspectors must cover a wide range of issues during the course of an inspection, they are often expected to be subject matter experts on everything. Errors and omissions insurance coverage can help to protect inspectors from oversights in one or more of the complex systems that they are required to examine, such as air conditioning, foundations, roofs and heating or electrical systems.

errors and omissions

What Limits Should I Choose for My Home Inspetion Insurance?

Understanding insurance limits for E&O insurance can seem complicated if you are not sure exactly what kind of coverage you need. When choosing insurance limits for E&O, it’s important to understand what the two different limits represent. The first number indicates the amount that you will be covered per incident, while the second represents the annual maximum. For example, a $250K/$500K insurance limit would mean that you are covered up to $250,000 per incident, but you will be covered up to $500,000 per year. In the event of a claim, the E&O insurance limits that you choose will cover expenses related to your defense as well as any payouts to homeowners. Keeping all of this in mind, there are several factors that you will have to take into account when choosing the E&O insurance limits that are right for you.

When contemplating how much E&O insurance to carry, the first consideration is compliance with any state or regulatory requirements..  While some states do not have any insurance requirements, many do so be sure to apply for coverage accordingly. Another consideration for insurance limits is the value of the homes you are inspecting. For instance, if you are in an area where you typically inspect properties in the $250,000 range, you will want to take that into consideration when choosing your limit. You will also need to take into account how many inspectors work with you, as well as the length of time you have been in business. Both of these factors can affect the amount of coverage that you need. The longer you have been in business and the more inspectors that you work with, the higher the risk of a claim. You will want to weigh these points when deciding where to set your E&O insurance limits.

Elite InspectInsure has several different coverage limit options to choose from ranging from $100,000 up to $2 million with options for various limits in between.  In addition to the home inspector E&O insurance, Elite offers a wide assortment of endorsements for ancillary services depending on what you offer to your clients. Protect yourself today by choosing the E&O insurance limits that are right for you.

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