Home Inspector E&O

Home inspector errors and omissions (E&O) is a specialized professional liability policy for residential and commercial property inspectors. It responds when a buyer or seller alleges the inspector's negligent inspection or report caused a financial loss, typically a missed or overlooked defect such as a failing roof, faulty wiring, foundation cracks, mold, or a hidden plumbing problem the client says should have been reported. As with most E&O, coverage is claims-made and applies only to work performed after the policy's retroactive date.

This coverage matters to a small inspection business because the entire product is professional judgment: an inspector who overlooks a defect can be blamed for the full cost the buyer incurs to repair it, an exposure that a general liability policy, which covers bodily injury and property damage but not economic loss from a faulty opinion, will not touch. Many states and franchise networks require inspectors to carry E&O as a licensing or membership condition, and real estate agents frequently steer clients only to inspectors who are insured.

A practical nuance: home inspector E&O and general liability are often bundled together because an inspector both renders professional opinions and physically enters properties where they could cause damage or trip a resident. Buyers should confirm whether ancillary services, radon, termite/WDO, mold sampling, sewer scoping, are included or excluded, as add-on services frequently need scheduled coverage. Because claims can arise long after the report is delivered, maintaining prior acts coverage and purchasing a tail at exit prevents an uninsured gap.