FLORIDA SINKHOLES Buyer Beware

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An overhead topographical map of Land O Lakes shows many hundreds of small and medium sized lakes and ponds. Are those areas more susceptible to sinkholes? Do your research and also be advised by professionals before you decide to buy. United States Geo Service VIEW HERE
Seventh home condemned after massive Land O Lakes Florida sinkhole VIEW HERE

Although it sounds scary to be living on top of swiss cheese, it doesn’t have to be overwhelming. Prior to buying a home in Florida, make sure you have done your homework and know what you are buying. You want to look for surface depressions in the land or cracks and displacement in the home itself. Also, be sure to ask the current owner if there have been any investigations as they are required by law to disclose this information. You can find more information on what to look for in - Top 5 Sinkhole Tips for Home Buyers.

In Florida, home insurers are required by law to offer residents protection for ONLY catastrophic ground cover collapse condemning the property
Sinkholes DO NOT fall under that heading, so be sure to talk with your insurer..

In areas that are prone to sinkhole activity like Pasco, Hernando, and Hillsborough counties, it is may be difficult, nearly impossible to obtain sinkhole loss coverage. Some insurers we have researched offer coverage for a large deductible like 10% of the properties value (example $230,000 home $23,000 deductible before insurance covers the rest) Wall cracks do not count it must be foundation damage that the access.

In 2011, the Florida legislature changes the statutes on how insurance companies handle sinkhole claims and issue sinkhole coverage. Before 2011, sinkhole coverage was automatically included into everyones homeowner insurance policy and the insurance companies were required to investigate every claim. That included everything from catastrophic collapse sinkholes that cause severe damage to homes to slow developing subsurface sinkhole activity that can take hundreds to thousands of years to form a sinkhole but can still cause damage to overlying structures.

That all changed when Senate Bill SB408 was passed in May of 2011. The new laws now made sinkhole coverage an optional and separate rider on home insurance policies. This also allowed insurance companies to opt out of coverage entirely. If the insurance company felt that the risk was too great, they either cancelled the policy or gave the homeowner the option of purchasing the additional rider for a separate and, in some areas of Florida, greatly increased rate. Many homeowners were left with no option but to drop their coverage. It is important to note that everyone who has homeowners insurance is still automatically covered for catastrophic collapse sinkholes that cause the home to be condemned. Dramatic cover collapse sinkhole,

This new legislature redefined what it takes for a sinkhole loss to be covered by insurance companies and also introduced a five pronged definition of structural damage. Now the home has to exhibit structural damage before a sinkhole loss can be confirmed, even if sinkhole activity is determined to be present at the home. If a homeowner has sinkhole coverage and files a claim today, the insurance company will send an engineering firm out to determine if the damage is severe enough to be classified as structural damage. They will not test to determine if sinkhole activity is present unless structural damage exists.

Charles Rutenberg Realty Associates
Robert Kuzmicz - Private Line (727) 399-1347

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