Excluded Twice Over
No residential service contract covers termite damage, and the exclusion is over-determined. A sample agreement excludes "animal, pet and/or pest damage" outright, but the claim would fail without that sentence. The coverage grant runs to the mechanical failure of covered systems and appliances from normal use. Termite damage is damage to the structure, not a system, and it is caused by an external agent rather than by wear - the two categories the grant is drafted to keep out.
The same logic reaches further than people expect. A dishwasher whose wiring harness a rodent chewed has not suffered a mechanical failure; it has suffered pest damage to a covered appliance, and it is denied on the pest clause.
What makes termites different from the rest of this group is that a well-developed remedy market exists - somewhere else. A different licensed profession, a different form, a different ordering party, and a warranty sold by the pest control company rather than the warranty company.
The NPMA-33 Is Not Part of Your Home Inspection
A WDI (wood-destroying insect) or WDO (wood-destroying organism) inspection is a separately licensed inspection performed by a pest management professional and reported on Form NPMA-33, "Wood Destroying Insect Inspection Report," published by the National Pest Management Association and accepted by HUD/FHA and VA. The current revision is dated 7/01/19. WDO is the broader term used in Florida and the Southeast because it also captures wood-decay fungi; WDI covers termites, carpenter ants and bees, and wood-boring beetles.
Five sections: I, general information on company, property, inspector credentials and structures inspected; II, findings - visible evidence of wood-destroying insects, or its absence; III, treatment recommendations; IV, obstructions and inaccessible areas; V, comments and signatures.
The disclaimers are the load-bearing part. The form states on its face that "This is not a structural damage report," and that it "is not a guarantee or warranty against latent, concealed, or future infestations or wood destroying insect damage." The first means a clear report says nothing about whether framing has been compromised; the second, that it speaks only to what was visible that day.
New construction uses different paperwork. For a home proposed, under construction, or under a year old, the pair is HUD-NPMA-99-A, the Subterranean Termite Protection Builder's Guarantee, completed by the builder, and HUD-NPMA-99-B, the New Construction Subterranean Termite Service Record, completed by the pest control company and naming the code-accepted method used: soil or wood applied liquid termiticide, bait system, or physical barrier. Both carry an OMB expiration of 7-31-2027.
Two Documents, Two Professions
This is the most commonly confused pair of documents in a residential transaction.
| General home inspection | WDI report / NPMA-33 | |
|---|---|---|
| Performed by | Home inspector; licensed in 30-plus states | Licensed pest control applicator |
| Governed by | ASHI or InterNACHI Standards of Practice | State pest control law; the form itself |
| Reports on | Systems, components and their condition | Visible evidence of WDI activity and damage |
| Structural adequacy? | Yes, within the standard | Expressly not - "not a structural damage report" |
| Client | The buyer | Often the lender, via buyer or seller |
| Required by law? | Almost never | Yes, when the VA Notice of Value or FHA requires it |
Both standards exclude pests affirmatively. Under InterNACHI's, the inspector is not required to determine "the presence of evidence of rodents, birds, bats, animals, insects, or other pests." Under ASHI's, not required to report "the presence or absence of pests such as wood damaging organisms, rodents, or insects." An inspector who sees mud tubes will photograph them and refer out - a courtesy, not a scope item, and no substitute for the NPMA-33. A buyer who assumes the home inspection covered termites has skipped a document, not saved a fee.
When the Report Is Required, and Who Pays
On a VA loan, a wood-destroying insect inspection is required where the Notice of Value calls for it, driven by whether the property sits in a termite-prone area rather than by a fixed list of states. The payment rule changed recently, against the buyer. VA Circular 26-22-11, dated June 15, 2022, provides that "Veterans may be charged wood destroying pest inspection fees, where required by the NOV," and permits veterans to pay for repairs needed to satisfy Minimum Property Requirements.
That reversed decades of practice under which the fee was a non-allowable charge the seller absorbed, so any checklist published before mid-2022 saying a veteran can never pay is now wrong. The VA State Fees and Charges Deviations List dated February 17, 2026 carries the same allowance as a non-state-specific fee variance.
On an FHA loan, if any of four triggering factors apply, HUD mandates use and submission of the NPMA-33. New construction substitutes the 99-A and 99-B pair.
Whether a WDI report is required on every transaction in a state, as opposed to when the lender requires it, varies by source and lender overlay. Confirm it against the loan file, not local custom.
Where the Code Requires Protection in the First Place
Termite geography is set by building code, not local custom. The International Residential Code keys its termite provisions to Figure R301.2(6), the Termite Infestation Probability map: very heavy, moderate to heavy, slight to moderate, none to slight. IRC R318 requires protection against subterranean termites in very heavy and moderate-to-heavy areas, using one or more approved methods: chemical termiticide treatment under R318.2, baiting systems, pressure-preservative-treated or naturally durable wood, physical barriers such as "metal or plastic sheeting or collars specifically designed for termite prevention," or cold-formed steel framing.
One detail provision shows up as an inspection finding: R318.4 bars foam plastic below grade on the exterior face of foundations in high-probability areas, and requires above-grade foam to keep not less than 6 inches of clearance from exposed soil. Foam running down to dirt in a heavy-probability county is a code issue and a concealed termite pathway at once.
The map's use is comparative: an untreated house with no bond and no service history is an outlier in a very heavy probability county, and unremarkable in a none-to-slight one.
Subterranean, Drywood, and Formosan
Subterranean termites nest in soil and must keep soil contact for moisture. They build shelter tubes - mud tubes - across foundation walls, piers and joists to reach wood, described by extension entomologists as "typically about the diameter of a pencil." Colonies "may contain many thousands of individuals foraging in numerous directions," which is why spot treatment fails and why treatment is specified as a continuous barrier. Swarms are triggered "by warmer temperatures and rainfall" in spring; swarmers cause no damage and live about a day, but a swarm emerging indoors means an active colony inside. Damaged wood is "hollowed out along the grain, with bits of dried mud or soil lining the feeding galleries."
Drywood termites need no soil contact and live entirely within the wood they consume, which is why soil barriers do not reach them and why Gulf-coast and coastal California practice includes whole-structure fumigation. Frass rather than mud is the tell.
The Formosan subterranean termite, an invasive, changes the risk qualitatively: colonies of several million individuals, up to roughly 1,000 eggs per day, and a reputation as one of the most destructive structural pests in the country. It is established in Alabama, Florida, Georgia, Hawaii, Louisiana, Mississippi, North and South Carolina, Tennessee and Texas, plus some southern California counties. A native colony is managed over years; a Formosan colony can consume structural members within a season and will nest above ground where moisture allows, defeating the assumption that no soil contact means no termites.
The Bond Is the Product That Warrants Anything
The instrument that responds to termites is a termite bond, issued by the pest control company. University of Kentucky extension guidance describes the standard shape: warranties "usually stipulate that the company will return and retreat the affected area(s) at no additional charge provided the annual renewal is maintained," and "Some companies also will repair damage occurring after their treatment, although dating onset of termite damage is a hard thing to determine." On longevity: "All liquid termiticides are supposed to control termites for at least five years when applied according to label directions."
A refusal is informative: "no warranty will be offered if wells, drainage systems, sub-slab heat ducts, or inaccessible crawl spaces make it impossible to treat in accordance with industry standards." A house nobody will bond has a treatment obstacle that does not go away for the new owner.
What determines a bond's worth is retreatment-only versus retreatment plus damage repair. A retreatment-only bond obligates the company to come back and treat; it pays nothing toward the joist. A repair bond costs materially more, caps the obligation, and always excludes damage predating the bond - which is why the inception date and transferability of an existing bond matter more than its existence. A transferable twelve-year-old bond covers a wider span of damage than one written the week before closing. The extension bulletin on termite control is a better guide to a treatment proposal than any contractor's brochure.
Section IV, and What to Read Before the Window Closes
The most under-read part of an NPMA-33 is Section IV, obstructions and inaccessible areas. Entries like "inaccessible crawlspace," "finished basement walls," or "insulation obscuring sill plate" record that the inspection did not happen where infestation is most likely. A clear Section II with a long Section IV is not a clean report; it is a partial one, and the response is to clear the obstruction and re-inspect.
The rest of the sequence inside an option period is a set of questions with documentary answers:
- Order the WDI separately and early. Reports carry a limited validity window for lenders, so a long escrow can force a re-inspection.
- Ask for the existing bond: inception date, transfer terms and deadline, and whether it is retreatment-only or includes repair.
- Ask for the treatment history, and for 99-A and 99-B paperwork on new construction.
- In a Formosan-established state, ask specifically about Formosans - a standard soil-barrier plan is calibrated to native subterraneans.
- Where there is prior evidence but no current activity, the open question is what the earlier infestation damaged - a structural question, needing an answer from someone whose report is allowed to give one.
None of this is expensive, and all of it depends on a window that closes on a date - after which a clean-looking form and an unread Section IV become the buyer's problem.
Frequently Asked Questions
Does a home warranty cover termite damage or treatment?
No. Sample residential service agreements exclude animal, pet and pest damage outright. The claim would fail even without that clause, because the coverage grant reaches mechanical failure of covered systems and appliances from normal use, while termite damage is structural damage caused by an external agent. The product that responds to termites is a termite bond sold by a pest control company on annual renewal.
Is a termite inspection part of a home inspection?
No. They are separate inspections by separately licensed professionals under different governing documents. The InterNACHI standard relieves the home inspector of any requirement to determine the presence of evidence of rodents, birds, bats, animals, insects or other pests, and ASHI's does the same for wood damaging organisms. An inspector who notices mud tubes will note them and refer out, but that courtesy does not produce the NPMA-33 a lender requires.
Who pays for the termite inspection on a VA loan?
Since VA Circular 26-22-11, dated June 15, 2022, veterans may be charged wood destroying pest inspection fees where the Notice of Value requires the inspection. The same circular allows a veteran to pay for repairs needed to meet Minimum Property Requirements, while encouraging negotiation with the seller. That reversed long-standing practice in which the fee was a non-allowable charge the seller absorbed, so older guidance saying the veteran can never pay is out of date.
What does a clear NPMA-33 actually certify?
Only that no visible evidence of wood-destroying insects was observed in accessible areas on the day of inspection. The form states that it is not a structural damage report and is not a guarantee or warranty against latent, concealed or future infestations or damage. It therefore says nothing about whether framing damaged by a past infestation is sound, or about anything behind the walls, stored belongings and inaccessible spaces listed in Section IV.
Should I take over the seller's termite bond?
Usually the transfer is worth more than a new bond, because damage predating a bond is excluded and an older bond covers a wider span of possible damage. Bonds are frequently transferable for a fee. The terms to read are the transfer deadline - often a set number of days after closing, sometimes with an inspection - whether the bond is retreatment-only or includes capped damage repair, and whether annual renewal has been maintained without lapse.
I saw winged insects indoors in the spring. How serious is that?
A swarm emerging inside the structure indicates an active, established colony already in the building, which is the most serious of the common visual findings. Swarming is triggered by warmer temperatures and rainfall in spring, and the swarmers themselves cause no damage and live roughly a day - they are evidence of the problem, not the problem. Mud tubes on foundation walls and wood hollowed along the grain with soil-lined galleries carry the same weight.