The purpose of the contract provision that this bill seeks to prohibit is to deter frivolous and/or meritless lawsuits and to specify that the value of a home inspection is based on the professional service provided in the performance of a limited visual inspection of the general condition of a property’s systems and components as specified by a Standard of Practice (SOP).  Per 18VAC15-40-120(C), a home inspection contract shall disclose that the home inspection and report are not a home warranty, guarantee, insurance policy, or substitute for real estate transfer disclosures which may be required by law; therefore, the use of a Limitation of Liability clause is intended to provide the inspector with a degree of protection from such claims. 

In consideration of the Limitation of Liability provision of the home inspection contract, the mutual agreement further acknowledges: (i) actual damages may be difficult or impractical to ascertain via a visual/non-invasive inspection; (ii) allocates a level of risk between the parties; and (iii) enables the inspector to perform the inspection for the agreed-upon fee.  18VAC15-40-30(G) currently requires a VA licensed home inspector to carry a minimum of $250,000 in general liability insurance coverage to serve as protection for the subject property from damages.  

As many of my industry colleagues have already indicated, there are several key issues that will have a detrimental impact on the Home Inspection Industry in Virginia due to the unlimited liability, risk, and exposure factors proposed by SB 627 including, but not limited to: elevated insurance costs and a reduction in VA licensed inspectors.  These factors alone will result in a significant increase in operational costs that will be passed along to the consumer.  Drastic rising costs of a home inspection will certainly cause many potential home buyers or sellers to forego the home inspection process entirely. 

It is my humble opinion that passing SB 627 would have a significant adverse effect on the entire Virginia Real Estate market.  Impacting not only the home inspector, but also the buyer, seller, and their agents respectively.  Please make the right decision and do not enact SB 627.

Respectively,

Jonathan Russell
Senior Home Inspector
A-Pro Home Inspection Services