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PRE-PURCHASE INSPECTIONS CLAIMS ON THE RISE

Belinda Smith, CEO of Rapid Solutions, shares her insights into the rising number of claims being made relating to pre-purchase pest inspections.

 

Everyone’s talking about Australia’s booming real estate industry and being super busy with pre-purchase inspection reports. More consumers are relying on your reports in a market where many are paying ‘overs’ to secure property. If you can service them quickly and efficiently – and compliantly – you’ll have happy customers who spread the word to other keen buyers.

However, a word of caution. A high proportion of current Rapid Solutions claims are for pre-purchase inspections and the number is rising. So what’s the issue?

It’s the usual story where new owners find issues 2-12 months after purchase, either due to renovating, perhaps declined storm damage claims, or simply taking a closer look. In Australia’s increasingly litigious society, consumers have greater access to legal services, including ‘no-win-no-fee’ lawyers. They’re more prone to passing on blame, and rectification costs, to others.

To help yourself avoid a potential claim, take heed of these consistent shortcomings we’re seeing and address them in your reporting and management of pre- purchase inspections:

Photos: Reports that include photographs of key site areas, whether illustrating issues or not, provide valuable snapshots of real-time property condition. They provide evidence of findings: conducive conditions, existing termite damage, roof trusses in satisfactory condition, etc. Take many photos (close-up and for context) and label them clearly.

Recommendations: Experience tells us generic recommendations for invasive inspections or termite treatments won’t mount a successful claim defence. Make specific recommendations, including relevant timeframes, to explain the severity of potential or existing issues.

Consistency: We often see reports stating “no conducive conditions” but elsewhere rate the property at “high risk” of termite infestation. Ensure your findings, recommendations and ratings line up throughout.

Communicate: In most claims seen, the purchaser receives the inspection report and doesn’t enquire further, even with a high risk of termite damage or infestation. Actioning (and documenting) a simple follow-up highlighting your main points and reinforcing identified risks might make the difference at claim time.

Rapid Solutions’ free real-time reporting app, Rapid Inspect, helps you accomplish much of this and will prompt you at every step to create an Australian Standards-compliant job report. Take advantage of this to help yourself avoid claims.

If you do receive a customer complaint or potential claim, let your insurer know ASAP. We’ve seen many claims where clients who try to self-manage a complaint by offering refunds, minor repairs, or attending a site meeting, are later accused of admitting liability.

Responding quickly to customers, without admitting liability, serves you better than ignoring complaints and hoping they will disappear. Get in touch with your insurer – it’s a policy condition, plus we’re here to help!

 

Belinda Smith, CEO, Rapid Solutions