Insurance Companies Allowed to Deny Sink Hole Coverage

Miami & Ft. Lauderdale, Florida

In a recent legislative session, the Florida legislature passed a bill, SB 408,  allowing insurance companies to deny sink hole coverage or to assess an additional premium for that coverage.  If you have or suspect you have sink hole damage, don’t wait.
Often times a homeowner faces a catastrophic lose due to damage created by a sink hole.  This property damage can well exceed the value of the home.  This is not a small claim.  Florida law provides a very specific time period to report sink hole damage to the insurance company in order to obtain coverage.  Failure to report sink hole damage timely would result in your claim being denied.
In conclusion, in light of the catastrophic claims that Trapnell Ridge homeowners are presented with, it would be our strong recommendation that those homeowners  who experience sink hole damage report those claims to the insurance companies as quickly as possible.
Recently, The Cochran Firm, accompanied by a nationally acclaimed geologist, toured 7 homes in the Trapnell Ridge development in Plant City, Florida.  It was determined that all 7 homes were demonstrating signs consistent with sink hole damage and poor soil conditions.  The Cochran Firm is currently investigating available options for the homeowners of Trapnell Ridge.  These options include first party claims against their personal homeowners’ insurance company as well as potential claims against the developers and engineers who originally planned the community.  Preliminary research indicates that a proper investigation prior to construction should have alerted the developer to the soil problems in the area that is causing the ground to be unstable resulting in sink holes.
One question presented by many homeowners is “Why do we have to place our own insurance company on notice?”  Concerns underlying this question include increase in premium and possible termination of coverage.  However, the risk of failing to notify your insurance carrier is far outweighed by the benefits associated with making a claim.  In addition, a claim against your insurance company, generally speaking, is a much simpler claim and more likely to be resolved favorably and in less time.  In light of the new legislation, it is likely that any sink hole coverage contained in a homeowner’s policy will no longer be available once that policy renews.
If a homeowner has or suspects they have damage as the result of a sink hole, it is recommended that they report those claims to the insurance companies as quickly as possible.   If a sink hole claim has already been denied by an insurance company, there may still be other legal options available to homeowners, but action must be taken to protect their rights.