Do I need sinkhole insurance in Florida? How much does it cost?

Lianna Norman, Palm Beach Post
·3 min read

No homeowner sits around and daydreams about their home being swallowed by a sinkhole. But in Florida, it’s not outside of the realm of possibilities.

According to The Florida Museum, sinkholes are quite common in the state. They’re naturally occurring, but are worsening due to human impact on the natural environment.

“As a result of climate change and land development, sinkhole formation in Florida is increasing,” The Florida Museum’s website says. “Periods of severe drought followed by intense rainfall can destabilize the ground leading to major outbreaks of new sinkholes opening. As the sea level rises, groundwater rises along with it, increasing the flooding of sinkholes further.”

“Even in times of moderate weather, man-made development increases the likelihood of sinkholes.”

But how can you protect your home from a sinkhole? Or even know if your home is on property that's at risk for sinkholes? Does homeowners’ insurance for sinkholes even exist?

Here’s what you need to know about sinkhole insurance and who offers it.

Do I need sinkhole insurance in Florida?

Not every Floridian needs sinkhole insurance, but it isn’t a bad thing to have if you can afford it.

Residents in the west-central area of the state have the greatest need for sinkhole insurance. Pasco, Hernando and Hillsborough counties are responsible for a lot of the state’s sinkholes, which has earned the region surrounding Tampa a nickname: “Sinkhole Alley.”

Does homeowners’ insurance cover sinkholes?

Similarly to flood insurance, coverage for damages related to sinkholes is not covered in homeowners’ insurance policies and must be purchased separately. Home insurance covers your actual house, not the land that it was built on.

Homeowners' insurance: How much do you need?

Which insurance companies offer sinkhole insurance?

Florida Statute 627 requires all insurance companies in the state to offer sinkhole insurance.

When you apply for a sinkhole insurance policy, the insurance company may send someone to your property to look for any existing structural damage your home might have. They also might test the land itself, to determine the geological probability of a sinkhole occurring.

“All insurance companies licensed in Florida must ‘offer’ sinkhole coverage,” according to the Florida Department of Financial Services. “However, an insurance company’s willingness to actually provide sinkhole coverage is contingent upon the characteristics of the ground structure beneath your home.”

Florida’s state-run, not-for-profit property insurance provider, Citizens Property Insurance, offers sinkhole coverage for HO-3 and HO-8 policy holders. Although, a more all-encompassing version of sinkhole insurance, called catastrophic ground cover collapse insurance, is automatically included in most Citizens’ home insurance policies.

According to Citizens, Catastrophic Ground Cover Collapse coverage applies only when geological activity results in all of the following conditions:

  • Abrupt collapse of ground cover

  • A depression in the ground cover that is clearly visible to the naked eye

  • Structural damage to the building, including the foundation

  • Condemnation of the structure and order by government authorities that it be vacated

Why does Florida get sinkholes? 30-foot sinkhole opens at Vitamin Shoppe lot in Ocala.

How much does sinkhole insurance cost?

Sinkhole insurance typically costs between $2,000 and $4,000 each year in Florida, depending on which insurance provider you use.

What are the warning signs of a sinkhole?

Here is a list of things to look out for in your home that might indicate a possible sinkhole, according to Foundation Professionals of Florida:

  • Cracks in interior joint areas

  • Cracks in stucco or exterior block

  • Sticking windows and doors

  • Yard or street depressions

  • Separations, cracks, and gaps in concrete

  • Wilting plants

  • Neighbors with sinkholes

  • Actual cavity forming

  • Foundation cracks

  • Settling foundation

  • Sloping floors

  • Ceiling cracks

  • Loss of pool water

This article originally appeared on Palm Beach Post: Florida sinkhole insurance explained. Who offers it, who should get it