Although some insurance claims are due to negligence on the part of the inspector, most are not. Most are the result of comments made, or not made, at the inspection and in the report and sometimes, after the inspection. Here's an example:
An inspector inspected an older home with a partial basement and partial crawl space. Everything was accessible, with the usual personal storage items.
Under Basement in her report, the inspector wrote "acceptable condition" along with a description of some conditions in need of minor maintenance. The buyer moved in, and one month later left the following message for the inspector, "I'm completely disappointed in your report and inspection. Call me." She promptly called the client and arranged to visit the property to discuss any concerns in person.
Upon meeting with the client, the inspector was shown cracked glass in a window and several receptacles missing cover plates. The inspector explained these items were minor and normal home maintenance items all homeowners need to budget for and that the receptacles were probably hidden by personal storage. Nevertheless, the inspector, in good faith, offered to pay $50 for the minor repairs and the client accepted. The inspector wrote a check and left the property.
Two more times the inspector received similar calls with similar results. She visited the property and wrote checks for $75 each time. When she received a fourth call for help, she listened to the complaint on the phone and refused to visit the property again for no charge and to pay for any repairs.
Three months later, the inspector was served a summons and the complaint outlined numerous issues that made the house uninhabitable. Therefore, the client has had to move out and is unable to live in the home. The matter was settled for a "nuisance" fee by the insurance carrier, which was kind enough to extend coverage even though the carrier was not notified of a potential claim at the time of the first phone call from the inspector's client.
The moral of this story: The inspector performed an inspection and delivered a report that met or exceeded national standards of practice. The inspector should have notified the insurance carrier when she received the first complaint. And, during that first visit, she should have admitted no guilt, taken photographs and obtained a full release in exchange for writing a check.
It's important to educate all clients to the scope and expectations of a home inspection and to provisions of the contract (a signed contract is a MUST) prior to the inspection, and sometimes again a few months later if they call regarding an item and question the accuracy of the inspection report.
Simply paying for a repair does not absolve you of responsibility in the client's mind. In fact, now you have set a precedent to pay for repairs. A refund of the entire inspection fee is best, with a complete release signed by the client, as then there is no longer compensation and you have a full release. Contact your attorney or insurance carrier for a proper release form.
Furthermore, if you return to a property, take photographs, which are better than relying on memory and verbal testimony when asked to describe actual conditions.