The cheapest (free!) and easiest insurance policy for real estate agents and their brokers (as well as for their sellers) is a code compliance retrofit inspection. As the seller (not the agent) typically pays for the retrofit/code compliance inspection, agents get a ‘free’ insurance policy covering their potential liability for the transaction with respect to items inspected within the retrofit inspection.
Though the likelihood of death or injury of a new buyer/owner caused by not having a retrofit inspection done is extremely low, the likelihood of getting sued if an agent does not have a retrofit inspection and death or injury does occur is extremely high. Injury attorneys will always look to what was not done by real estate agents if there was some type of accident or injury after the close of escrow.
And why should an agent risk it? It is no money out of the agents pocket of the agent to have a retrofit inspection completed. And in many times, the seller is more than happy to cover their liability by having a third party code compliance inspection done on their behalf. But many times the listing agent will never bring up this issue.
Are you a real estate agent and have more questions about liability and retrofit / code compliance inspections? Call us at 310-800-4418.
