Sinkhole Problems

Pasco and Hernando Counties have experienced dramatic problems with sinkholes. Geologists say this area of the state is particularly prone to the problem.  A sinkhole can strike anywhere, anytime, and take your home right out from under you.

While FCAN does not agree with the conclusions of the study, the Florida Senate issued a sinkhole study.  The study essentially concluded that sinkhole claims are swamping insurance companies and that many of the claims are insubstantial i.e. for cracks in the driveway.  Legislators seem to believe that a combination of greedy attorneys, greedy public adjusters, and dishonest homeowners (possibly under financial pressure because of the recession) are at fault.

The solution being proposed in S. 408 - the major insurance bill in the Senate Insurance Committee - is essentially eliminating sinkhole insurance coverage. The bill accomplishes that by narrowly defining a sinkhole (your house would have to fall into the hole) and giving insurance companies the option of not issuing the coverage.  Of course, no insurers are going to offer the coverage and this brings up a number of problems:

• Homeowners have mortages and are required to have sinkhole coverage. What will the banks do?
• Will Citizens offer sinkhole coverage?
• Do legislators intend everyone to get insurance from Citizens?
• How will legislators handle the wave of foreclosures if homeowners can't obtain insurance?

It's really a mess and there are no easy answers. Unfortunately, sinkholes DO occur and people need insurance. That's our bottom line. The Legislature's solution of simply outlawing sinkholes won't work.

In the Senate, Senator Mike Fasano is fighting for consumers.  Call his office and thank him for his leadership.  But there are few other supporters.  Call the Chair of the Senate Insurance Committee Garrett Richter and the Chair of the House Insurance Committee Bryan Nelson.

Call your legislators and ask them for real sinkhole insurance protection. Don't let the insurance companies write the rules.