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Does homeowners insurance cover sinkholes?

Top sinkhole questions answered

Homeowners insurance should cover the two homes that fell into the monstrous sinkhole in Pasco County last week, said Winter Springs insurance agent Kris Pontell.

"In the state of Florida, everyone is covered on their homeowners (insurance) with catastrophic ground collapse coverage," Pontell said. "It's the minor cracking where your home is livable that might not be covered and might be an expense to you."

That's where additional sinkhole coverage -- a sinkhole coverage rider -- comes in.

What is a sinkhole coverage rider?

Sometimes a sinkhole causes the ground to sink so slowly that a home shows foundation cracks subtly. 

Sometimes foundation cracks or cracks in the wall aren't even caused by sinkholes but rather settling.

Pontell said sinkhole coverage usually covers those cracks.

Is sinkhole coverage easy to get?

No, Pontell said. Insurance companies have strict guidelines and order home inspections done by engineers. If inspectors find existing cracks, most carriers will turn down the homeowner.

How much is sinkhole coverage?
First, keep in mind that you as the homeowner will be required to pay for the insurance company's inspection up front, usually around $150, according to Pontell. If coverage is offered, it's around $100 per year on top of your homeowners insurance policy, Pontell said.

Do I need sinkhole coverage?
"It is definitely a good coverage to have," Pontell said. "But I don't think it's anything you should be concerned with unless something were to pop up on your street. It's not really something worth keeping yourself up at night. You buy the best policy with the best company and get good advice, and if something big does happen hopefully your insurance will protect you."

Is my home at risk for a sinkhole?
"It's hard for the general consumer to know that, unless they have access to some type of history," Pontell said.

Insurance companies have access to reports and sometimes real estate agents can order them. But even reports generated by public record checks can be wrong.

"There's no foolproof way to know if your home had past sinkhole issues if it's an older home," Pontell said.

How do I check if I have sinkholes in my neighborhood?

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Also, talk to neighbors, check your property appraiser's website and call your municipality's permitting office.

Will I get a sinkhole under my home?

"It's not as common as people think. We insure a lot of homes and very few have ever had a true sinkhole," Pontell said. "I'd say in the last three years I've had no sinkhole claims."

How common or rare are sinkholes?

Longtime Winter Springs real estate agent Kim Coburn has encountered several over the years under homes she's bought and sold.

"In 35 years in my career, I know of maybe six or seven in the Seminole County area," she said.

They do occur, Coburn said, but the vast majority of homes are not affected.

"I don't think you have to really worry about sinkholes anymore than you have to worry about a hurricane," Coburn said.

What should I do if I see cracking in my walls?

Call an engineer that specializes in sinkholes. Most cracking is caused by settling, not a sinkhole.

What if I do have a sinkhole?

Follow your engineer's advice.

"Make sure you do everything structural engineers tell you to do to make your home sound," Coburn said.

According to reports, the massive sinkhole in Pasco County opened up once before and the homeowner was advised to fill it with compacted grout or concrete. The homeowner chose a significantly cheaper solution -- pin piles.

How do I check if a sinkhole affected the home I'm looking to buy?

"The sellers are required to disclose if there were any sinkhole claims on a property," Coburn said. "They're also required to disclose even if there was any settlement."

Coburn also suggested to ask your realtor to run a report.

"A CLUE report will show where the sinkholes are in the area but it's not 100 percent reliable though," Coburn said. "You can't always tell and that's why it's a matter of believing a home seller and it's required by law to state whether you had sinkhole issues or even settling issues for that matter."

If I rent my home, will my renters insurance cover sinkhole damage?

Probably not, said Pontell, but it will cover your belongings in the event of damage and renters insurance is always a good idea.

How does a sinkhole form?

Over time, sand under the surface can dry out (especially after a severe drought) and pour into cracks in the limestone rock deep under ground causing sinking. Much of Central Florida's limestone is covered by sand thus the occasional sinkhole.


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