I attended a meeting of inspectors yesterday. A lawyer from the Texas Real Estate Commission had come to speak to us on how to avoid customer complaints, but we behaved badly towards her. It has been ruled that an amendment slipped in at the last moment by a representative who works for an insurance firm does force all inspectors to have E&O insurance, or its equivalent. This caused several of my fellows to start screaming their comments about this law. Fortunately, she managed to muddle through, and I thought these comments might be of interest to some of you.
You do not need to tell anyone who your E&O provider is, until the discovery period of a trial if your disagreement with the client comes to that.
The real estate commission loves for you to take photographs, since this will help resolve an issue. The prosecuting attorney would hold it against you if you do not take a photograph of every single item on your report.
In the states that already require E&O for inspectors, the amount of prosecutions (or complaints) have not had any drastic rise.
It is always best to resolve the issue with a client immediately, by going out there and dealing with it. (I thought this one obvious, but it appeared not to be).
If you resolve the complaint with your client, you can have it retracted from the state's investigation process by contacting them by mail, and stating how it was resolved. They will have to check that out, of course.
The best course of action is that we just have to do our job to the best of our abilities each time, and we should always be improving those abilities.
An interesting development mentioned (and I am still researching this) is that starting this September all rural homes will have to be inspected. Apparently this rule will apply to all new construction as well. I was wondering if any of you know of a similar law in your area? So far, I have always seen that inspections are optional.
Also, I was wondering if anyone has experience with E&O and what you think of it.