What’s General Liability Insurance?

By Stephanie Jaynes, Marketing Director, InspectorPro Insurance

A seller sues an inspector for leaving the bathtub running, causing it to overflow and leak through the ceiling below. A real estate agent sends their inspector their medical bills after the inspector hit them with their drone.

What do all these claims have in common? They’re all examples of general liability insurance (GL) allegations.

General liability insurance—also called commercial liability, business liability, or just liability insurance—covers you for claims unrelated to the quality of your home inspection. While errors and omissions claims peg you for mistakes or oversights in your inspection report, general liability claims allege your business caused third-party property damage, bodily injury, or personal and advertising injury. These claims can come from not just clients, but others outside your business, too, including sellers, agents, and neighbors.

Keep in mind that different carriers can classify claims differently. So while these examples satisfy the definitions in most GL policies, some carriers might have definitions or exclusions. That’s why it’s important to read your policies and carry both E&O and general liability.

Now, let’s get back to common examples of general liability claims.

Property Damage

When someone accuses you of property damage, they’re saying you harmed or broke their home, furniture, or belongings during or as a result of your inspection. For example:

• While performing a pressure test, you inadvertently broke the garage door.
• As you traversed the attic, you tripped and your foot went through the ceiling.
• While climbing to the second tier of the roof, you caused shingle damage with your ladder.
• While looking through the lens of your IR camera, you bumped into a side table, knocking it over and breaking the lamp on top of it.

Breaking or damaging a third party’s property can lead to general liability claims. Note that GL policies only cover someone else’s property—not yours or your employees’.

Bodily Injury

When you receive accusations of bodily injury, people are accusing you of injuring them during or as a result of your inspection. Scenarios may include:

• After inspecting a crawlspace, you left the access hatch open. Later, the seller fell in and breaks her ribs.
• A client followed you up your ladder to watch you examine the roof. They fell off your ladder on the way back down.
• An inspector accidentally dislodged a loose staircase railing, which then hit the potential buyer in the head.

Accidentally physically hurting someone during or as a result of your inspection can lead to GL claims.

Personal or Advertising Injury

When someone sues for personal or advertising injury, they may be accusing you for slander, libel, privacy violations, or copyright infringement. For example:

• A seller sues you for telling the buyer they made shoddy roof repairs.
• An agent sues you after you texted a potential home buyer that the agent is bad at their job.
• A photographer’s attorney serves you after you used their photos on your website without payment or permission.

Damaging someone’s reputation, violating their privacy, or making advertising errors can all lead to general liability claims.

General liability claims happen to everyone.

Now, if you’re like most home inspectors, you’re careful. You aren’t sending droves of people to the ER, and you aren’t breaking things at every house. But in our experience, even the best inspectors can have accidents that cause third-party property damage or bodily injury.

Even if your state doesn’t require it, all inspectors should carry both general liability and errors and omissions (E&O) insurance. While GL claims can be costly, E&O claims tend to be the most common. That’s why every inspector needs both to protect their business.

As an ASHI member, you enjoy exclusive access to InspectorPro with the ASHI Advantage, which gives inspectors the best E&O and GL coverage for less. Click here to learn more about the ASHI Advantage’s benefits and discounts.