Home Inspector Insurance

Home Inspector Insurance

Comprehensive liability insurance package specifically designed for Canadian home inspectors.

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Zensurance - Home Inspector
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Insurance for Home Inspectors

Home inspectors play a valuable role in any house purchase. They are recommended as part of the buying process whether someone is a first-time homebuyer or purchased multiple homes beforehand. However, having a natural ability to see details that others don’t, prospective homebuyers often get caught up in the ideals of home and overlook some crucial information – such as a discoloured baseboard due to water damage or signs of wood rot in the attic. 

As a home inspector, you’re a professional when it comes to focusing on the details. Still, there are times when elements can be accidentally missed, and that can be financially detrimental to a home purchase decision. Plus, there’s the risk that an accident could happen beyond your control – such as accidental property damage or a slip and fall that you’re held liable for the cause.  Therefore, it’s always important to protect yourself, your clients, and your home inspection business with a risk management strategy.

At Zensurance, we know your business is unique in its offerings, and it’s our mission to make insurance as accessible as possible. Read on to learn the basics of insurance for home inspectors.

What is Home Inspector Insurance?

Home Inspector Insurance protects home inspection professionals against specific risks associated with the duties and responsibilities that come with the job. An insurance package consisting of general liability and errors and omissions policies providing financial coverage for your business from third-party liability or bodily injury claims. In addition to claims against alleged professional misconduct, such as negligence, errors or failure to deliver in your inspection service.

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What does it cover?

To protect your business against the risks you are most likely to face as a home inspector, consider the following coverages as part of your risk assessment strategy:

  • Errors and Omissions Insurance (E&O): This coverage protects home inspectors against claims from clients alleging they’ve experienced financial loss because of a service you provided. Claims can involve lawsuits for failing to deliver a service as promised due to accusations of negligence or misconduct. Here’s an example of an E&O claim for a home inspector – say you told a client that the roof on their potential home was in perfect condition before the closing of the sale. They went ahead with the purchase but then found out you’d overlooked an area of significant roof damage that would’ve deterred them from closing. Your client sues you for failing to accurately report the quality of the roof – in this case; an E&O policy may cover the cost of the legal fees.
  • Commercial General Liability Insurance (CGL): Accidents can happen anywhere, and in a home inspector’s case, they’re likely to occur at somebody else’s property. Commercial General Liability Insurance can protect home inspectors against common claims such as third-party bodily injury or property damage. Suppose you’re conducting a home inspection, and you accidentally break a pipe on the furnace while trying to inspect the service record tag. The homeowner could sue you for damaging their property – CGL could cover the cost of replacing the furnace along with any legal fees associated.

Additional coverages to consider:

  • Commercial Property Insurance: Commercial Property Insurance protects your business location and the property inside from an insured event, such as a fire, theft or vandalism. Even if you work from home, Commercial Property Insurance can be an important coverage if you have expensive equipment for your inspections, as this is unlikely to be covered by a homeowners policy. Suppose your office experienced water damage from a burst pipe and destroyed the expensive drone you use for aerial inspections. In this case, Commercial Property Insurance could cover the cost to replace your drone and any other business-related property that was damaged or destroyed.
  • Cyber Liability Insurance: Cyber Liability Insurance may be critical coverage for your home inspection business if you hold or share the results of a home inspection with your client online. Cyber Liability Insurance covers the financial losses caused by cyberattacks or other tech-related risks, along with privacy investigations or lawsuits following an attack. For example, confidential data you hold about multiple home inspections is hacked, and the hacker is using this information as ransom. Cyber Liability Insurance could cover the cost of the ransom and any other fees required to restore data.

Who needs it?

Any individual or business providing home inspection services, including generalized services or specialized services, should protect their business with a CGL and E&O Insurance policy. In some provinces within Canada – such as British Columbia and Ontario – insurance is required to operate as a licensed home inspector.

Along with general home inspectors, we’ve insured home inspectors practicing in a range of specialties, including:

  • Mold Inspectors
  • Roofing Inspectors
  • Electrical Inspectors
  • Pool or Spa Inspectors

How much does it cost?

All home inspection businesses are unique, so it’s difficult to give a set amount as insurance costs vary by size and services offered. But, for a ballpark figure, home inspectors can anticipate premiums starting from around $3,500 annually for an E&O and CGL Insurance policy package with a $1M combined limit.

Here are some of the factors that are taken into consideration when determining the best policy options for your practice:

  • Annual and Projected Gross Revenue
  • Years of Experience
  • Number of Employees
  • Years of Business Operations
  • Value of Properties Inspected
  • Claims History
  • Types of Property Inspections (i.e. Residential, Commercial)

When you fill out our online application, we ask questions about your business that help us to understand your requirements better and, in turn, give you a more accurate quote.

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Common claims scenarios

Frequently asked questions

What are the insurance requirements for home inspectors?

Some provinces in Canada (e.g. Ontario) require home inspectors by law to carry both Errors and Omissions and Commercial General Liability Insurance. There are minimum monetary limits for both coverages, though it may be likely you’ll need higher amounts to be adequately covered. Even in provinces where it’s not mandatory to carry insurance, the risks that come with being a home inspector aren’t eliminated. Therefore, Home Inspection Insurance should be part of your risk assessment strategy wherever you live in Canada.

If I operate a home inspection company, does my policy cover my employees?

Yes, employees may be covered by your home inspection insurance policy. However, your policy limit typically applies to all employees under your policy rather than individual employees. In addition, you will have the option to increase your limit to ensure your team is adequately covered. For more information, speak with a broker about the size of your business, and they’ll help to educate you on how much insurance you’ll need.

Can a home inspector be sued?

Yes – home inspectors have a duty to perform their job to industry standards. Prospective buyers rely on the accuracy of an inspection report when putting in an offer or deciding to walk away from a purchase. If a home inspector makes errors or causes property damage, they can be found liable.

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As a home inspector, you’ve dedicated your career to helping others find peace of mind in their big purchase; you deserve a broker dedicated to providing you with peace of mind in your business activities.

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