Sinkhole insurance, like earthquake coverage, is typically prohibitively expensive. Sinkhole insurance may cost roughly $2,100 per year in some Florida counties with a history of sinkholes more than the state minimum.
Does insurance cover a sinkhole?
Sinkholes are not covered by a conventional homeowners insurance policy since “earth movement” is excluded. That implies you won’t be compensated if a sinkhole causes damage to your home or personal property.
Sinkhole coverage is frequently available as an endorsement (sometimes known as a rider) to a homeowners insurance policy, depending on your insurance carrier.
Sinkhole insurance is required in some areas, such as Florida and Tennessee, and is available as an optional plan. Some insurance companies, however, provide sinkhole coverage in their policy. Sinkhole coverage is included in Erie insurance for clients in Tennessee, for example.
- Alabama. Sinkhole coverage may be available at an added cost from homeowners’ insurers in Alabama.
- Florida. Sinkhole coverage is required to be offered as an add-on by home insurance carriers in Florida. “Catastrophic ground cover collapse” must be covered by Florida homeowners’ insurance policies. (See below for more information.)
- Kentucky. Sinkhole collapse coverage may be available as an optional coverage type for homeowners in Kentucky.
- Missouri. Sinkhole collapse coverage may be available as an endorsement from homeowners’ insurance providers in Missouri. If your insurer is unable to provide coverage, you may be eligible to purchase a separate sinkhole policy through the Missouri FAIR plan.
- Pennsylvania. Homeowners in Pennsylvania will have to pay an extra fee to their insurers for sinkhole coverage.
- Tennessee. Sinkhole coverage is mandated by law in Tennessee for all home insurance companies.
- Texas. Sinkhole coverage may be available as an endorsement to a homeowner’s insurance policy in Texas.
Does flood insurance cover sinkholes?
Earth movement-related damage, such as sinkholes, landslides, and earthquakes, is not covered by typical homeowners insurance. Because sinkholes aren’t considered a covered risk, you’ll need to buy supplemental sinkhole insurance to safeguard your house completely.
Your dwelling coverage covers your home’s foundation and frame and insures it up to its current value.
What is a sinkhole?
Sinkholes are depressions or holes in the ground caused by the flow of rock or sediment into voids generated by water-soluble rock dissolving. Sinkholes can be small or huge, shallow or deep. According to studies, low water levels, a lack of rainfall, or even significant rainfall over short periods of time all contribute to the formation of sinkholes.
Does my home insurance cover sinkhole damage?
According to the Florida Senate Banking and Insurance Committee, property insurance policies routinely exclude coverage for earth movement, such as sinkholes, across the country. Home insurance plans were never designed to cover what happens below ground, such as a sinkhole, according to Lynne McChristian, the Insurance Information Institute’s representative in Florida. Its purpose is to cover the structure as well as the contents.
Check your insurance policy for your home or other property to see if it covers sinkholes, according to the Pennsylvania Department of Conservation and Natural Resources.
“Finding out after the fact that your house is not covered by your insurance for damages caused by (a sinkhole) is a difficult lesson to learn,” according to the department.
Sinkhole damage coverage has been required for home insurance carriers in Florida since 1981, at an additional fee.
Sinkholes are not covered by most homeowner’s insurance policies, including those from State Farm, the nation’s largest home insurer. “Any damage caused by them is clearly excluded,” says spokesman Kip Diggs.
State Farm, according to Diggs, only covers sinkhole damage in three states: Alabama, Florida, and Pennsylvania.
Farmers Insurance homeowner’s insurance plans, according to spokesman Luis Sahagun, only cover sinkhole damage in two states: Florida and Tennessee.
What should I do if I sinkhole shows up on my property?
It is recommended that you call your insurance carrier if a sinkhole appears on your property. Notify your county’s emergency management agency if there has been serious damage. If you’re unsure if you have a sinkhole, get a private contractor to inspect it.
If your home is damaged by a sinkhole, your insurance company will likely seek a geological investigation to determine the cause of the damage. If it’s a sinkhole, the insurer will usually cover the costs of testing and repairs (minus your deductible). McChristian estimates that testing a potential sinkhole will cost between $8,000 and $12,000.
If your home’s foundation has been damaged by a sinkhole, specialists may need to pour cement to shore it up.
Will what has occurred in Florida happen in other states?
That is extremely unlikely. Sinkhole claims haven’t been a major concern in the United States, with the exception of Florida.
“In Texas, we haven’t seen a lot of sinkholes,” says Jerry Johns, a representative for the Southwest Insurance Information Service.
“If that becomes an issue,” Johns continues, “it will differ from insurance company to insurance company.” That type of loss will be viewed differently by each organization.”
According to Lynne McChristian, the Insurance Information Institute’s representative in Florida, one way the new state law will reduce bogus sinkhole claims is by precisely defining what constitutes structural damage caused by sinkholes. Because previous state law did not include any criteria for sinkhole-related structural damage, many dubious sinkhole claims were rewarded. Many Florida sinkhole claims, for example, involving breaches in foundations, driveways, walls, and ceilings have been paid, despite the fact that the damage was caused by natural settling of the ground beneath a home. One issue is that it’s difficult to prove that a sinkhole is to blame for such damage.
According to McChristian, only 1% of Florida sinkholes cause significant property damage. Officials in Florida can’t pinpoint a geological basis for the rise in sinkhole claims.
According to a report from the state Senate Banking and Insurance Committee, more than three-quarters of Florida policyholders did not repair any property damage after receiving a sinkhole claim settlement in recent years.
Some people learned they could just “take the money and run” because the old Florida legislation didn’t compel landowners to fix sinkhole damage after receiving claim funds, according to McChristian.
What does sinkhole insurance cost in Florida?
In high-risk areas, policies can be costly. The annual premium for sinkhole loss coverage in some Florida counties can be more than the average cost of a homeowners insurance policy in the state. To determine the likelihood of a future sinkhole, consult a professional research or the history of the land around your property.
Homeowners who built their homes in places where sinkholes are unlikely to occur may opt out of coverage. Though it’s difficult to predict when and where sinkholes may occur, the Insurance Information Institute quotes academics who believe that sinkholes strike a given property roughly once every 100 years.
Do I need sinkhole insurance in Florida?
The state of Florida has more sinkholes than any other in the country. Not all homeowner’s insurance policies cover damage to your home caused by sinkholes. Insurance companies are required by Florida law to cover “catastrophic ground cover collapse.”
Do I need sinkhole coverage in Tennessee?
Sinkhole insurance is not required in Tennessee, and some firms will not automatically supply it. When homeowners’ insurance companies receive a sinkhole claim, they must carefully analyze Tenn. Code Ann. 56-7-130 to ensure that they are following the statute’s express wording.
How do you know if you have a sinkhole in your yard?
It’s likely that you’ve seen a sinkhole before. If not in person, then on the news, as they frequently make for exciting headlines. It’s a fascinating, if dangerous, natural geological phenomenon that occurs frequently. Although the aftermath is difficult to overlook after it occurs, there are ways to detect a sinkhole in advance. We’ll show you how to recognize the 7 most typical indications of sinkholes before they happen in this article. When assessing the safety of your property, keep these markers in mindthey could save you a lot of time and money!
When water (rain) in the atmosphere combines with carbon dioxide to generate a weak carbonic acid, sinkholes occur. The slightly acidic precipitation that falls to the ground then seeps into limestone-like sediment. Small fissures are common in these rocks, and acidic rainwater dissolves more rock, expanding the fissures. This erosion eventually results in air or water-filled pockets. Caves or voids are formed when those pockets get large enough. This is when things start to get sinkholey (we know, it’s not a real word, but we like it).
In other words, the larger a subterranean hole becomes, the less probable it is to be able to maintain its ceiling. A sinkhole occurs when the roof of a vacuum degrades to the point of collapse.
Because everything takes place beneath, spotting a potential sinkhole can be difficult. This is especially true because some sinkholes have no surface expressions (or evidence on the surface). However, many sinkholes have surface expressions that can be used to prevent risk.
A foundation settling:
A sinkhole growing beneath a house or building could be indicated by part of the structure slipping down and cracking. Expansion of clay could potentially cause cracks in your foundation. Measure the thickness of your foundation and how far beneath the surface it reaches to ensure that it is at correct levels. Check your dimensions against the building codes in your area. If your foundation is below the level required by your construction code, you should conduct certain geophysical testing to be certain.
Cracks in roads or pavement:
Crocodile cracks (also known as alligator cracks) in asphalt and pavement can form for a variety of causes. One reason could be that problems in the subgrade are arising.
A sudden drop of well water levels on a site:
Even if there is no visible emotion, this is worth investigating. A decline in well levels could suggest the opening of a sinkhole beneath the property, affecting the water table.
(BONUS tip for getting to the end of the list) Public Sources:
We consider this a plus because there isn’t exactly an on-site sign to look for. If you’re buying or managing property, though, it’s a good idea to look for publicly available sources that can provide you with information on your property. The USDA, for example, lists known Karst areas, which are limestone-based landscapes with a high density of cracks, solution channels, and caves (and thus, possible sinkholes). They also provide soil maps/surveys and data on sites where sinkholes have been repaired!
Sinkholes are particularly common in Florida, Alabama, Missouri, Kentucky, Tennessee, Pennsylvania, and our home state of Texas. However, no matter where you are in the world, it’s a good idea to remember the eight tips listed above to avoid or repair sinkholes before they occur.
Note: This is a reprint of a previous blog post, The 7 Most Common Sinkhole Signs & How To Test For Them, which was originally published on September 12, 2016.