Florida has more occurrences of sinkhole activities than any other states. With Florida Statute 627.706, it requires each insurance company (that provides property insurance) to also offer coverage on catastrophic ground cover collapse. Nevertheless, sinkhole damage may not be included in your homeowner’s policy because the law describes this damage as something different from catastrophic ground cover collapse.
According to Florida law, a sinkhole refers to the landform made by soil subsidence, residue or underlying rock layer dissolved by the groundwater. This sinkhole can be a result of a collapse in subterranean voids formed by limestone dissolution, subsidence or dolostone when these strata begun to dissolve.
Florida State has identified a disastrous ground cover collapse as an environmental and geographical activity caused by the following:
- sudden collapsing of the surface of the ground
- a deterioration of the ground cover which is noticeable to human eyes
- destruction to the building structure as well as to its foundation
- insured structure ordered to be evacuated by the government agency
Florida Statutes also say that content coverage is applied if loss has resulted from a catastrophic ground cover collapse. A damage in structure such as cracking or settling of the foundation, building or structure, will not add up to the loss caused by the catastrophic ground cover collapse.
If you have no coverage for the sinkhole insurance and your property gets destroyed by a sinkhole activity, the claim you will file should meet the above 4 criteria. If not, your insurance provider will ignore legally your claim and they will not pay you.
All insurance providers with license to offer insurance in Florida are also required to provide sinkhole insurance coverage. Often, such coverage functions as an additional coverage or rider to the homeowner’s insurance policy. Due to this extra coverage, the policyholder is also expected to pay bigger amount of premium.
If your house has shifted caused by the ground cover collapse, what follows next are some important steps you may consider:
- Take all essential steps to guarantee the security of anyone who is in contact with the place. To give warning to everyone about this danger, put a rope or install a fence around the property and sinkhole. If someone is injured in your property, then you will be held liable in the court.
- If it’s secured to do so, remove or protect your personal property.
- Be ready to vacate your house.
- Get in touch with your agent or insurance provider.
- Contact local authorities (city or county building department).
- Contact a lawyer who can handle claims on sinkhole.
For Home Buyers
Be sure that the house and property can be insured. Ensure that sinkhole coverage is also contained within your homeowner’s insurance policy. However, if sinkhole coverage is not included, consider buying a separate sinkhole insurance policy.
Often, mortgage lenders need to do a house inspection. So when you hire the services of a home inspector, hire an inspector who is a certified state contractor. He must also secure necessary credentials proving that he’s certified and a member of NACHI (Nat. Association of Certified Home Inspector). Make sure that your house inspection particularly addresses every issue related with sinkhole activities.
For your concern, you can consider hiring a skilled engineer to do testing for sinkhole activity. It may be expensive and requires a few days to get it done. Your insurance provider can’t require you to pay for the sinkhole test prior to issuing a policy.
To get additional information about Sinkhole Coverage in Florida, please contact us at DMG Insurance and Financial Services, Inc. (http://www.dmginsurance.com) at 543 N State Road 7, STE 106, Royal Palm Beach EL, 33411, phone 561 422 7071, Fax 561 422 7072.