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Having Affordable Coverage (HAC) and
Florida Consumer Action Network (FCAN)
Public Sinkhole Workshop

 Meeting Summary - August 18, 2007


HAC and FCAN hosted a public sinkhole workshop on August 18, 2007 to inform the public about the impact of upcoming changes in homeowners’ insurance sinkhole coverage.  The program included panel discussions between homeowners and experts on sinkholes, insurance and legal matters.  The workshop was held from 9 a.m. to 12:30 p.m. at Spartan Manor in New Port Richey, Florida. 

Workshop Goal:

To cooperatively discuss the Pasco/Hernando homeowners’ insurance issue, including the pilot program, and explore possible alternative solutions with residents and experts.

Workshop Objectives: 

  • To build understanding about the Pasco/Hernando insurance pilot program.
  • To identify unanswered questions that must be addressed for residents to be fully informed about the program.
  • To brainstorm ideas of how residents can protect their homes and keep costs reasonable.


  • Ginny Stevans, President, Having Affordable Coverage.
  • Wil Nickerson, Secretary, Having Affordable Coverage.
  • Bill Newton, Executive Director, Florida Consumer Action Network.
  • Ron Haggard, Geologist.
  • Ron Broderick, President, Earth Tech.
  • Darrel or Dale Hannicky, Geotechnical engineer.
  • John Kulwicki, Mortgage lender.
  • Dan Amend, State of Florida Division of Financial Services.
  • John Burrow, Condominium owner.
  • Wanda Stevens, Manufactured homeowner


Ginny Stevans welcomed the group and discussed the purpose of the workshop. 

Bill Newton thanked the attendees for coming, pointed out that the two groups wanted to get the community’s ideas and take those to our government leaders.  Facilitator was Michelle Robinson. 

Stevans led a panel discussion that included John Burrow representing condominium owners, Wil Nickerson representing Having Affordable Coverage and Wanda Stevens representing manufactured homeowners.  Dan Amend from the Florida Department of Financial Services also participated.


Homeowners Panel

Condo Owners Discussion:

G. Stevans pointed out that the pilot program doesn’t cover everyone since condos and manufactured homes are considered commercial/residential property and required to have sinkhole coverage.  If condos opt-out of sinkhole coverage, the board of the condo association is at risk. Burrow stated that the legislature’s decision to exclude condo owners from the deductions is unjust.

Proposed Solutions: 

1. Have condos reclassified as residential.

2. Have condo association see if they can drop coverage considering the fiduciary responsibility of the board and financial risk of each owner for a repair, individual assessments and dues.

3. Consider self-insurance, even though it is expensive and 80 percent of funds must be available. 

Manufactured Homeowners Discussion:

G. Stevans stated that manufactured homes are also left out of the pilot program and are seeing increases in premiums.  She said that a problem for manufactured homeowners is that they still need insurance on their homes and land under them is co-owned. Amend said that there are few sinkhole claims on mobile homes and not much of the rate goes to sinkhole coverage.  It may only go down $50.  Amend said that the 2004 hurricanes devastated mobile homeowners. Amend said that mobile homes are paying so much because of wind coverage for hurricanes. 

Proposed Solutions: 

1. Experts recommended that it be acknowledged that there is no particular type of construction that makes you immune from sinkholes since it is a geological issue. 

2. Experts agreed that since manufactured homes have fewer occurrences of sinkholes, they should get a better discount. 

Single Family Homeowners Discussion:

G. Stevans said that homeowners continue to be told coverage is so high because of sinkhole claims. She pointed out the Pasco County Assistant Attorney, Elizabeth Blair is quoted saying “We have an effort underway to recognize areas that have significant geological hazardous conditions.”  Then we have Florida's governmental agencies and geologist saying we have sinkholes, but the pilot program suggests homeowners drop sinkhole coverage to save money.  She said that people should have the choice to take on such enormous risk and not have it yanked from under them.  HAC only knows of two banks that will not require people to have sinkhole coverage.  A question came up about how to prove how long someone has had a sinkhole.  The geologist said that sinkhole activity takes thousands of years to evolve. It was also noted by the expert panel that it has been said that State Farm is looking into requiring a homeowner to test the area to opt back in, once they have opted-out of sinkhole coverage at a cost which can cost $7,000-$10,000. Once a homeowner opts-out, the chances to get back in may not be good, she fears.  Amends could not confirm that if someone opts out it will take two years to get back in and that Citizens insurance company will do some kind of investigation.  Amends said that sinkhole coverage does not transfer to a new owner. 

Proposed Solutions: 

1. Examine if there will be penalties for opt-in at a later date. 

2. Determine if banks will require people to have sinkhole coverage. 

3. Find out if Citizens is going to require a test and if there are any costs involved. 

4. See if there is a policy for getting back in after you opt-out.

Experts Panel 

Bill Newton:  

Newton said that he spoke with Senator Fasano and the Senator told Newton that his office would be happy to take suggestions to Tallahassee. Newton said that FCAN has been working on insurance for a number of years and has built a statewide coalition.  FCAN is also working with manufactured homeowners association. He said the coalition will be able to take this workshop’s ideas to Tallahassee.

John Kulwicki, mortgage lender:

Kulwicki advised homeowners to check with insurance carriers to determine if they can drop sinkhole coverage.  He advised homeowners to keep sinkhole coverage, especially West Pasco. Kulwicki stated that when buying a home, buyers should investigate if a sinkhole occurred and if there was a full claim paid out it; if so, it won’t be insured. Only a few companies will insure a house without sinkhole coverage. 

Ron Haggard, geologist:

Haggard said that over 20 years, he has conducted 5,000 sinkhole studies and found 40 percent were legitimate.  He defined catastrophic sinkholes as those with a visual hole, structural change and the house condemned. He said that the average stabilization cost to fix a home with a sinkhole is $40,000 to $65,000, not including cosmetic repairs. He defined a sinkhole as ground surface expression of some activity occurring farther underground.  

Ron Broderick, Earth Tech:  

Broderick said his company comes in after engineers and does the work. His company’s concern is that people are unprepared to make an informed decision on this issue. Broderick conducted an informal survey and found that homes are three times more likely to be damaged by a sinkhole than a fire. Broderick said people need to understand the risks in order to make an informed decision on whether to buy back coverage. Broderick said officials keep saying there is no sinkhole problem, yet the county is pre-grouting and pre-stabilizing new construction projects as a precaution to sinkhole occurrences.

Dan Amend, State Division of Financial Services:

Amend said his organization tries to help people having insurance problems and try to educate people facing insurance issues. Cost problems are all over the state. His office advises that homeowners comparison-shop insurance every year.  He noted owners could determine their policy renewal date and call his office 30-60 days before for help finding a less costly alternative.

Questions and Responses:

The workshop attendees were asked: “What questions have yet to be answered about the pilot program?” These issues came up as still unclear: 

  • Can we change the pilot program?
  • Can I opt-in later?
  • What is the value of opting-in? What are you going to get for your money?
  • How long will this pilot program last?
  • Why is it called pilot if it is going to last forever?
  • How long are rates frozen?
  • Why aren’t risks spread out across the state, if we are bearing the burden of hurricanes across other parts of the state why can’t they bear the burden of our sinkholes?
  • Why do people have to conduct testing if they choose to opt-in at a later date?
  • Why were Pasco and Hernando singled out?
  • Is it constitutional to separate out Pasco and Hernando from the rest of the state?
  • Why not limit the lawyers and property adjusters?

Attendees were asked: “What do you think residents could do to call this issue to the attention of their neighbors, other members of the public, legislators, the media, etc?” Responses were: 

  • Information being sent out is poor and does not effectively explain what catastrophic means to your insurance policy.
  • We’re confused about opting-in and opting-out.
  • We need to hold the legislature, governor and OIR accountable.
  • We need more uniform regulation of laws.  Eliminate surplus lines.
  • The more we complain the more the issues are going to stay up there (in Tallahassee). 
  • Hold a special session. 
  • Senator Fasano should consult with geologists to be apprised of the situation as it truly is.
  • Insurance agents need to give better information. 
  • Legislators are discriminating Pasco and Hernando.
  • Insurance situation needs to be revamped and legislature needs to encourage insurance companies to come back to Florida.
  • Get involved with HAC.
  • Stay informed, read the paper, tell your neighbors. 
  • Have phone call committees. Write articles to newsletters for HOAs. Email the associations.
  • Attend New Port Richey city hall meetings and Pasco BOCC meetings.
  • Respond to papers via letters to the editor.
  • Invite media to all meetings at club houses. 
  • Picket Fasano’s office.
  • Campaign finance reform.
  • Another bus to Tallahassee and this time get on the agenda earlier.

Attendees were asked: “What solutions can government or the private sector offer?” Responses were: 

  • Sinkhole coverage should be transparent – itemized on the policy.
  • State should itemize your bill and in readable language. 
  • Permits being issued should be available on county assessor’s website. 
  • Create a statewide sinkhole fund and spread the cost.