Florida homeowner insurance restricts us from several coverage features. One that can be quite confusing to several homeowners is the difference between "Sinkhole" and "Catastrophic Ground Collapse".
Most homeowners polices in Florida exclude coverage for "sinkhole activity" however they provide you with the opportunity to request and endorse your policy to include such coverage for additional premium.
However, All Florida homeowners policies do include coverage for "catastrophic ground collapse" which is defined below:
Catastrophic ground cover collapse” is defined as “geological activity that results in all of the following:
1). The abrupt collapse of the ground cover;
2). A depression in the ground cover clearly visible to the naked eye;
3). Structural damage to the building including the foundation; and
4). The insured structure being condemned and ordered to be vacated by the government agency authorized by law to issue such an order for that structure.”
This means that if your home is damaged by sinkhole activity, but does not meet all four criteria for catastrophic ground cover collapse – for instance, you may have foundation cracks, but the home is still livable – your insurance may not pay for the damage if you do not have sinkhole coverage
If you wish to request to include "sinkhole activity" you must contact your agent and/or insurance company to request a sinkhole inspection usually with in 45 days of the effective date. There is a small fee for this inspection, typically less than $225.00 and the insurance company will usually split the cost. However there is not a guarantee that coverage will be extended. You must receive a favorable inspection.
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