Surveyors & valuers PI

RICS HomeBuyer Report: what it is called now, and where the PI exposure sits

Category: Surveyors and valuers · Reviewed by the Apex broking team · Last reviewed 2026-08-22

In short: “HomeBuyer Report” is the older name for what RICS now calls a Level 2 Home Survey. The RICS Home Survey Standard, published in November 2020 and effective from 1 March 2021, replaced the old product names with three defined levels of service, and a Level 2 can be commissioned as a survey only or as a survey with a valuation. For a surveying practice the renaming matters less than what follows from it: the level defines the scope, the scope defines the duty, and the duty is what a professional indemnity claim gets measured against.

What changed, and when

RICS published the Home Survey Standard, 1st edition, on 2 November 2020, with an effective date of 1 March 2021. It replaced the older residential survey product names with three levels of service, described by RICS as the Level 1, Level 2 and Level 3 Home Survey. RICS’s own consumer guidance confirms that the Level 2 Home Survey was “previously called a HomeBuyer Report or Home Buyers’ Survey”.

A second edition of the standard has been in development. RICS’s guidance to members is that the 1st edition remains the version to use until the second edition takes full effect, so a practice should check the current status on the RICS website before assuming a change has landed.

The three levels in outline

Level 1 is the least detailed of the three: an inspection and report giving a professional opinion on the condition of the property, with condition ratings, but without the extended commentary of the higher levels.

Level 2 is the middle service and the direct successor to the HomeBuyer Report. It involves a more detailed inspection and report, with condition ratings, advice on defects and on repairs and ongoing maintenance. RICS is explicit that a Level 2 can be a survey only, or a survey and a valuation: the valuation version includes everything in the survey-only version plus a market valuation and an insurance reinstatement figure.

Level 3 is the most detailed service, aimed at older, larger, altered or unusual properties, giving a fuller investigation and a more extensive report on the fabric and its defects. In RICS’s consumer comparison, valuation is not listed as a feature of Level 3.

Because the levels are defined by service rather than by product name, the practical question for a surveyor is no longer “which report am I selling?” but “what did I agree to do, and does the report I produced match it?”

Why the level is the centre of a PI claim

Residential survey claims almost always turn on scope. The buyer complains about something the surveyor did not report. The surveyor answers that the item was outside the level of service commissioned, or was not reasonably visible on a non-invasive inspection, or was flagged as requiring further specialist investigation. Everything then depends on what the terms of engagement said, what the standard says the level involves, and what the report itself actually communicated.

That is why the drafting of the terms of engagement is a claims-defence document as much as a commercial one. It is where the level is identified, where the limits of the inspection are set, and where any assumptions and exclusions are recorded. Reports that flag a risk in general terms without recommending a clear next step are a recurring source of argument.

Duty to the buyer where the lender instructs

The other classic exposure arises where the surveyor is instructed by the lender rather than by the purchaser. In Smith v Eric S Bush [1990] 1 AC 831 the House of Lords held that a surveyor instructed by a mortgage lender to value a modest residential property owed a duty of care to the purchaser who could be expected to rely on the valuation, and that a disclaimer of that duty did not satisfy the reasonableness requirement of the Unfair Contract Terms Act 1977 in that context. Our case note is at Smith v Eric S Bush (surveyor angle), and the wider negligent-valuation doctrine at Hedley Byrne for surveyors.

The consequence for a practice is that the population who can sue is not confined to the person who paid the fee. Where a Level 2 with valuation is being produced for a lender client, the practice should be clear about who else is entitled to rely on it and should insure on that basis.

The valuation element changes the exposure

A survey that reports on condition and a valuation that produces a figure fail in different ways. A condition claim is usually about a defect that should have been seen or should have been described; the loss is the cost of putting it right, or the difference in value. A valuation claim is about the figure itself, and the loss can be far larger because a lender may have advanced money on the strength of it.

Practices offering the Level 2 survey-and-valuation service are therefore carrying two different risk profiles under one instruction, and underwriters price them separately. Our related material: RICS Red Book valuations and PII, chartered surveyors and Red Book valuations, and PI for valuation-only surveyors. Putting one presentation to several insurers rather than approaching them one at a time is the practical case for our surveyors professional indemnity broking page.

What underwriters ask a residential practice

The recurring questions are about mix and about controls. What proportion of instructions are Level 1, Level 2 survey-only, Level 2 with valuation and Level 3. Whether the practice acts for lenders and on what panel terms. Whether standard terms of engagement are used consistently and who signs them off. What the file review and report checking arrangements look like. Whether the practice has a clear position on liability caps and on who may rely on a report. Firms that can answer those crisply usually place well; firms that cannot tend to be underwritten to the worst case in the mix.

RICS PII requirements

RICS-regulated firms must hold professional indemnity insurance meeting the RICS requirements, including minimum limits set by reference to turnover and cover on RICS-approved terms, with run-off obligations on cessation. Those are set out in RICS PI insurance requirements for surveyors, RICS banded PI minimums and the RICS minimum wording explained.

How Apex approaches residential surveying practices

We start with the instruction mix and the terms of engagement, because between them they determine most of what a claim will look like. From there it is the usual work: making sure the limit is sized against the values being surveyed and lent on rather than against fee income alone, checking that the wording is RICS-approved and that the run-off position is understood, and presenting the file review and quality controls the practice actually operates. Full guidance at surveyors’ professional indemnity insurance UK and PI insurance for surveyors: the buyer’s guide.

Frequently asked questions

Is the RICS HomeBuyer Report still called that?

Not in RICS's current terminology. Under the RICS Home Survey Standard, which took effect on 1 March 2021, the service is a Level 2 Home Survey. RICS's consumer guidance records that Level 2 was previously called a HomeBuyer Report or Home Buyers' Survey, so the older name is still widely recognised by consumers even though it is no longer the standard's terminology.

Does a Level 2 Home Survey include a valuation?

It can, but it does not have to. RICS states that a Level 2 can be a survey only, or a survey and a valuation. The version with valuation includes everything in the survey-only service plus a market valuation and an insurance reinstatement figure, so the two are different services with different exposure profiles.

Which survey level carries the most professional indemnity risk?

There is no single answer, because risk follows the gap between what was agreed and what was delivered. A Level 1 report on a property that needed a Level 3 can be as dangerous as a Level 3 done poorly. Where a valuation is included, the potential loss is usually larger, because a lender may have advanced money in reliance on the figure.

Can a buyer sue a surveyor who was instructed by the lender?

Potentially yes. In Smith v Eric S Bush [1990] 1 AC 831 the House of Lords held that a surveyor valuing a modest residential property for a mortgage lender owed a duty of care to the purchaser who could be expected to rely on the valuation, and that a disclaimer did not meet the reasonableness test under the Unfair Contract Terms Act 1977 in those circumstances. Practices should be clear in their terms of engagement about who may rely on a report.