Sinkholes and Homeowner's Insurance
Posted: February 08, 2010
Sinkholes may not be a commonly thought of disaster for most homeowners, but if you own property in Florida (especially in Southwest Florida), they should be. When compared with other states, Florida outranks them all for having the most sinkholes, and homeowners need to be aware of the pitfalls they may present (no pun intended). What many homeowners may not realize is that even if the sinkhole was a result of factors such as construction, heavy rains, or ground water pumping, the homeowner would still be liable for the damages to their property.
As a general rule, homeowners insurance companies are only required to advise their policy holders that sinkhole insurance is strongly recommended (at an additional cost). Homeowners looking to purchase sinkhole insurance should qualify several different carriers, since each will have different requirements on receiving coverage. Additionally, should a sinkhole occur, and it is reported to a homeowner's insurance company, they can expect a number of things to happen.
First, the insurance company will most likely order a geological report (to either confirm or deny that the sinkhole was the prime reason for the damage). If the sinkhole is the cause, the insurance company should absorb the cost of testing and subsequent repairs. If the claim is denied, the homeowner can request a "neutral evaluation" from the Department of Financial Services. Costs for the second evaluation should also be absorbed by the insurance company.
For additional info, contact the Department of Financial Services consumer help line at 1-877-693-5236, or visit the following website: www.myfloridacfo.com.
Information and article provided courtesy of Florida Realtor and the Tampa Tribune.
As always, please feel free to contact me at 239-357-9558 with any of your Real Estate needs or questions. Rgds, Jay
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