Discrimination and BIPD Coverage

Here are Two Reasons to Prefer OREP’s Appraiser E&O Policy

1. Discrimination Claim Coverage
Discrimination is excluded in many appraiser E&O policies.

Just like fraud, discrimination is excluded by the majority of insurance carriers. For example, here is an exclusion found in the policy of one of OREP’s competitors:
Discrimination of any kind by the Named Insured, including but not limited to discrimination due to or on the basis of age, sex, race, color, religion, disability, marital status, pregnancy, national origin, HIV or AIDS status, sexual origin, sexual orientation, or sexual preference;

This is bad news for appraisers.

However, the good news is that OREP has been closely monitoring this issue and proactively worked with its primary carrier to address it. OREP’s primary individual appraiser E&O policy, for example, now includes $200,000 in coverage for any claim brought against appraisers alleging discrimination.

Including $200,000 of coverage for discrimination claims for individual appraisers makes OREP’s primary policy uniquely positioned to keep appraisers protected in today’s litigious climate. Not every OREP policy includes the coverage, so please ask your agent to ensure the coverage is included.

2. Bodily Injury and Property Damage Coverage
Bodily Injury Property Damage Coverage (BIPD) protects appraisers for what E&O does not cover: accidental damage to property or bodily injury (BIPD) you may cause while you are providing your professional services at an appraisal inspection. For example, if you step through a ceiling during an attic inspection causing property damage or drop a flashlight (from the roof) breaking a homeowner’s toe (bodily injury). BIPD coverage is not included with traditional E&O policies, but is now included free with one program OREP offers. This coverage is especially important if you do FHA appraisals.

However, a basic Appraiser E&O policy will only provide coverage for errors or omissions made in reporting/professional services, such as using the wrong zoning, failing to report an easement or unpermitted improvements, measuring square footage incorrectly, or making other mistakes or oversights in your reports. This is a significant Coverage Gap that many appraisers should be concerned about.

For this reason, many insurance agencies try to sell appraisers a second General Liability insurance policy for $300 to $500 per year. Few appraisers actually carry this coverage. GL is carried by most retail establishments, as well as more “physical” professions such as contractors, plumbers, etc. The coverage can vary but it can cover your tools and it typically protects business against “slip and fall” lawsuits by providing Bodily Injury and Property Damage (BIPD) coverage.

Some of the real-life examples of BIPD-related claims that we’ve seen here at OREP include:
-Insured exits the rear sliding door to measure the home but steps into newly poured cement that was just finished by the contractor several hours prior.
-Insured flushes the toilet and it overflows causing water damage to expensive flooring.
-Insured opens an attic hatch and (allegedly) causes damage to pop-corn ceiling.
-Insured steps through a ceiling during an attic inspection.

The Good News is that OREP’s flagship E&O program includes (at no additional cost) $100,000 of BIPD premises liability coverage (bodily injury/property damage). OREP insureds, in most states, now enjoy this valuable coverage at no charge when renewing their E&O insurance with OREP.