Provide Evidence of Financial Assurance

You’ve trained, you’ve studied, and you’ve passed. Now it’s time to comply with Arizona’s home inspector insurance requirements.

While learning how to become a home inspector in Arizona, you need to provide proof of assurance against claims to yourself or your home inspection business. The American Society of Home Inspectors (ASHI) lists a few options available to Arizona inspectors:

1. One, proof of errors and omissions (E&O) insurance with a $200,000 aggregate, $100,000 per occurrence.
2. Two, a surety bond valued at $25,000.
3. Or three, an alternative approved by the AZBTR.

If you lose your financial assurance, you run the risk of having your home inspection certification suspended. In this event, you would have 90 days to obtain insurance and get your certification reinstated. Otherwise, the Board will revoke it.

E&O and GL

With over a decade of experience serving the home inspection industry, we here at InspectorPro firmly believe insurance coverage offers the most comprehensive and dependable protection. When you buy E&O insurance, you’re protected against accusations of missing something during your home inspections or leaving something out of your report. In other words, it protects you from clients who accuse you of not doing your job right.

Though not included among Arizona’s home inspector insurance requirements, we also highly encourage general liability (GL) coverage. GL protects you if your work causes damage to the inspection property or bodily injury to a realtor, client, seller, and etc. In this litigious industry, maintaining E&O and GL exceeds your minimum expectations. It also gets you the full spectrum of claims protection. Read our comparative article to learn more about E&O and GL, how they’re different, and why every inspector needs both.

Surety Bonds

As you explore your options for how to become a home inspector in Arizona, a $25,000-value surety bond might seem like the way to go. In our experience, however, many inspectors assume being bonded and insured are two terms for the same protection. On the contrary, insurance and bonds are very different.

First, you should know that bonds do not protect the home inspector who buys them. Rather, they’re designed to protect third parties. If you receive a claim with a bond, you’re expected to cover losses yourself up to the bond’s total value (in this case, up to $25,000!). That is to say, you assume all the risk and get none of the protective benefits.

With a policy, the insurance company (insurer) assumes liability for the home inspector and/or their business. The insurance company also agrees to defend the home inspector in the event of a claim. Therefore, when you have an insurance policy, like ours here at InspectorPro, your insurance steps in to protect you—not the third party—and pay for losses on your behalf. This means significantly less stress and financial burden while managing your new home inspection business. Explore the differences between bonds and insurance policies in our blog post.

Workers’ Compensation

If you decide to hire employees in the future, review Arizona’s workers’ compensation requirements. These are established by the Industrial Commission of Arizona. Read about the benefits of workers’ comp on our website.