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[SEAOC] Earthquake Insurance Rates for 1997[Subject Prev][Subject Next][Thread Prev][Thread Next]
- To: seaoc(--nospam--at)seaoc.org
- Subject: [SEAOC] Earthquake Insurance Rates for 1997
- From: FEMCCLURE(--nospam--at)aol.com
- Date: Wed, 4 Dec 1996 19:26:37 -0500
- Cc: HARRISENGR(--nospam--at)aol.com
Tom Harris, December 4, 1996 Thank you for your concerns about the proposed earthquake insurance rates for 1997. I agree with your conclusions that the proposed earthquake insurance coverage with its 15% deductibles and lower interior coverage and living expenses does not sound like a good investment. However, before you offer to provide seismic evaluations for homeowners inorder for them to obtain lower insurance rates, lower deductibles, and higher interior coverage and living expense coverage, I would hope you would consider the potential professional liability you might be incurring. I would suggest that you talk with your friendly attorney and professional liability insurance carrier about the possible increased professional liability you might be assuming for a small professional fee as compared with your and your estate's potential liability. These professionals can help you with language to put in your reports to attempt to limit your exposure. I am not an attorney, but you might consider including wording at the end of your reports like "My professional services have been performed using that degree of care and skill ordinarily exercised, under similar circumstances, by reputable engineers practicing in the structural field in this or similar localities at this time. No other warranty, expressed or implied, is made as to the professional advice or conclusions included in this report. This report has been prepared for you only to be used for your sole purposes related to the subject property. This report has not been prepared for use by other parties, and may not contain sufficient information for purposes of other parties or other uses." It would be a good practice to get some wording in your agreement with the homeowners to limit your professional liability to dollar value of you fee. Why am I so concerned about performing seismic evaluations for homeowners? Based on an actual case, the homeowners attempted to use the Structural Engineer's Structural Engineering Report as a "total" homeowner's home insurance policy and sued the Structural Engineer for the repair and replacement of their roof when it leaked during a rain storm after they had his report. This Structural Engineer is a personal friend and related this case story. In response to a request by his architectural client, he reluctantly agreed to make the "usual" type structural and seismic investigation for a couple, whom he was lead to believe were planning to purchase the house. He performed the "typical structural investigation" for a single family dwelling and send them a report, which apparently did not define the areas of his investigation in clear terms. It turns out that the couple were lawyers and had already purchase the house and attempted to use his report as an "all comphresive homeowners policy" when the roof leaked. They threatened to sue for the cost of the repair and replacement of the roof. He retained an attorney who was able to get the threat of the lawsuit eliminated, but the Structural Engineer had to pay a $3,000 attorney fee. Talk to some of your other civil and structural engineer colleagues and exchange ideas of how to carry out your very public spirited idea of how to help homeowners to obtain more reasonable earthquake coverage for their homes at lower rates, but, please, be very careful to protect yourself and limit your professional liability exposure to you and even your estate, after you are gone. Keep up the good ideas. You are correct, I do not make "house calls." Frank E. McClure FEMCCLURE(--nospam--at)aol.com ...
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