Termite prevention and control contracts are often mistakenly referred to as “termite bonds”. Termite service contracts are actually “trade guarantees” and no different than any other service agreement you might receive from a trade contractor. They are not “bonds” as only a licensed surety company can issue bonds.
Termite guarantees are backed by the reputation of the pest control company and its insurance carrier. Florida law requires pest control operators to maintain at least $250,000 per single occurrence and $500,000 in aggregate errors & omissions coverage. Every contract will clearly define the maximum dollar value of coverage offered.
The Florida Department of Agriculture & Consumer Services (FDACS) regulates termite contracts in Florida. FDACS requires pest control companies to be certified in the category of WDO inspections and termites and FDACS requires those licensed companies to clearly define the terms of the termite guarantee. FDACS stipulates a termite guarantee must be one of the following:
- No guarantee
- Monitoring only (no guarantee)
- Retreatment only
- Repair and retreatment
Further, FDACS requires the company to specifically define what specie of termite(s) are covered. The majority of termite contracts cover infestation of the native, Eastern Subterranean Termite only. This means if your home is infested with another specie of termite, you have no coverage. This is worrisome to homeowners if their home is located in an area with a high probability of hybrid termites or Formosan termites. You may not know, and the service provider may not tell you.
Many homeowners may purchase a home that has a renewable guarantee in place. Many mistakenly assume the contract mostly because it may be cheaper than initiating a new service with an updated treatment. This is often a big mistake as the initial treatment on the home may be old and no longer optimal. Liquid chemical treatments in our climate have a life expectancy of 3-5 years and unscrupulous termite companies are known to continue offering annual renewals long after the efficacy of the treatment is viable. They know people just don’t want to hear they need to spend hundreds of dollars updating their termite protection. Homeowners are lulled into a false sense of security thinking they have a “bond” and/or termite protection without fully understanding the limitations of the contract. Real estate agents happily disclose the home has a “termite bond” but they rarely have any knowledge of the merits of the “bond”. Homeowners should be thinking about avoiding termite infestations rather than having them treated after the fact.
Homeowners and home buyers should take the time to understand the probability of termite infestation in their area. Simply, some areas present a higher risk than others. There are some areas in Florida where it may be impossible to get any type of guarantee for Formosan or Asian-Formosan subterranean termites due to the magnitude of their colonies in that area. Check out this link for updated termite distribution in Florida.
New home buyers would be wise to investigate termite pressures in the area before buying.
No termite contract includes coverage for old or existing damage. Generally, if no active termites are present or the activity is low, but the home has extensive structural damage, the damage would be considered old. This is a perfect example of why a home buyer should be aware of the treatment(s) performed on the home over the years. Lapses in termite coverage often result in termite infestation and damage which may not be visible in an inspection.
Active termite contracts with no guarantee typically relate to “control” of an infestation or spot treatments.
Retreatment only contracts provide for retreatment if live termites are found but do not provide for structural repairs. Retreatment only contracts typically relate to homes that had an active infestation.
Repair & Retreatment
Repair and retreatment contracts provide for limited structural repairs along with retreatment should active termites (listed in the contract) infest the home. This is considered to be the best offer but you should understand there are most likely conditions attached to the offer.
Homeowners have an obligation to keep the home in good condition and to report any evidence of termite infestation if found. Most contracts have disclaimers for “conducive conditions” such as keeping vegetation away from the foundation, repairing faulty sprinkler systems, keeping mulch below the finish floor elevation or siding, keeping wood piles away from the home, maintaining site drainage and in general, keeping the home in good condition and free of leakage. Moisture is attractive to subterranean termites and the pest control company may deny any claim if the property is not being maintained properly.
In closing, property owners should understand the type of termite protection they have. While it may be attractive to pay an annual renewal fee for coverage, you are gambling if you are relying upon outdated chemical treatments.