A sinkhole is a natural depression or hole in the surface topography caused by the removal of soil or bedrock, often both, by water.
"Sinkholes are an unpredictable part of the Florida landscape,
especially in West Central Florida and the greater Tampa Bay area,....Make sure that sinkhole coverage is included in your policy, or in a
according to a flier for home buyers from the state Department of
In particular, Pasco and Hernando Counties are affected. 67 of the 112 sinkhole insurance
complaints to Florida sinkhole ombudsman David Fisher in 2006 came from Pasco, Hernando and Pinellas counties.
However, in 2007 sinkhole coverage became something that you had to opt in for.
and Hernando counties, and to a lesser extent in Pinellas and
Hillsborough counties, they may drop it and pay lower premiums. The risk and the savings in other parts of the state is a lot less.
Insurers blame a rash of sinkhole claims in Pasco and Hernando counties
for driving up rates there.
Lotane said regulators - who recommend as much coverage as possible -
will work with insurers to make sure customers get the right information
to make a well-informed decision.
The changes could cut unfounded claims for cracking and settling of
homes, a key talking point for Fasano, Legg and insurers.
Lotane said claims rejected by insurers end up costing $7,500 to $8,000
to investigate, and he blamed such cases for causing rates to rise.
Policies without sinkhole coverage would cover only catastrophic damage.
Lesser damage would not be covered, even if it was clearly caused by a
Can I opt out of sinkhole coverage?
We are very disappointed that our elected officials pushed for an
"opt-in" for sinkhole coverage vs. an "opt-out." Once again our right to
choose has been taken away and now everyone will have to follow their
If you want sinkhole coverage or you are required to carry sinkhole
coverage by your bank, you will have to buy it at a very high cost,
according to the Office of Insurance Regulations press release. No, the
Wachovia's and Fannie Mae's of the industry, which have billions in
mortgages, won't care. But if you are with a smaller or local bank, you
lose. And yes, as one of our elected officials told me, you can move
your mortgage to one of those banks. I wonder if he will be paying the
closing fees, points, penalties and possible larger interest rates for
The rest of the state still gets to choose if this is a savings they
need or want, but you no longer have the choice. What next? If having
affordable coverage means no coverage for anything that actually can
happen, then what are we paying insurance for?
Yes, you can now lower your bill by dropping your wind, sinkhole,
contents, increasing your deductible, but what do you have left to be
covered for? We at HAC believe that laws could have been changed to get
your premiums lowered without losing coverage, or allowing you to choose
to have coverage or not. We will continue to fight for lower, fair and
reasonable coverage but not at the expense of others and not by taking
away coverage you have always had.
We were dubbed "sinkhole alley" long before there were the fraudulent