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State lawmakers considering bill to expand sinkhole insurance coverage

Fri Mar 4th, 2016 on     Homeowners Insurance,    

The number of sinkholes here in Florida has risen to altogether alarming levels over the last decade, particularly in places like Citrus, Hernando and Pasco counties, which have earned the unfortunate nickname “sinkhole alley.”

While some of this sinkhole proliferation can be attributed to natural causes — prolonged droughts followed by significant rainfall — experts indicate that manmade events are equally to blame. For example, everything from the building or retention ponds and heavy ground water pumping to the intentional diversion of water routes and land development appear to have played a role in creating this problem.

Unfortunately, the people caught in the middle of all this are often homeowners, who have seen their options for securing any type of sinkhole coverage incredibly limited, as private insurers carriers have proven reluctant to offer it and, in they event they do, charge exorbitant premiums.

In recognition of this problem, state Senator Jack Latvala (R-Clearwater) has introduced legislation that, if passed, would give private insurers the chance to provide more coverage for sinkhole-related damage outside of just complete structural collapse, something otherwise covered under standard homeowner policies.

The legislation would essentially enable private insurers to offer customers more limited — and more affordable — sinkhole policies that cover things like foundation repair and building stabilization, but leave things like home contents and surrounding land stabilization uncovered.

Thus far, the bill and its counterpart in the House have won considerable support, clearing committees and waiting for floor votes in both chambers. However, it’s worth noting that the state Office of Insurance Regulation has expressed concern over the inclusion of language allowing these new sinkhole policies to avoid being filed with their office, a move they say effectively precludes objective review of rates.

Stay tuned for updates …

If you have questions or concerns relating to the denial of a claim under a homeowners policy, consider speaking with an experienced legal professional to learn more about your options. 

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