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Committee approves bill to require professional‑liability insurance for home inspectors
Summary
Rep. Lincoln Barnett’s bill replaces a requirement for general‑liability insurance with professional‑liability (errors‑and‑omissions) coverage, after testimony that general‑liability policies often exclude inspection errors that harm buyers.
The House Insurance and Commerce Committee voted to pass House Bill 16 25, a consumer‑protection measure that would amend current code requiring home inspectors to carry general liability insurance and instead require professional‑liability insurance (errors and omissions) that covers inspection mistakes.
Representative Lincoln Barnett, sponsor of HB 16 25, told the committee that the current statutory requirement—ACA 17‑52‑318—mandates general liability insurance but that those policies commonly do not cover professional inspection errors. Barnett presented two examples from his district in which buyers faced six‑figure repair bills after inspections that a court later found negligent; the home inspectors’ general‑liability carriers declined coverage for inspection errors, the sponsor said.
Barnett told the committee that professional‑liability policies are available and would better match the risk being insured. Deputy Commissioner Jimmy Harris of the Arkansas Insurance Department confirmed that professional‑liability policies for contractors are filed and approved in Arkansas. Committee members asked about cost and availability; Barnett said he had not received specific opposition from inspectors and that the amount of coverage and premium pricing would be consistent with existing requirements.
The fiscal note prepared for the bill indicated no state fiscal impact. Committee discussion emphasized consumer protection: Barnett said that even if a premium cost rises modestly for inspectors, the bill would ensure homeowners have a route to compensation when inspection errors occur.
Representative Richardson moved the committee’s motion to pass; the committee approved the bill on a voice vote.
