Sinkhole reference links and concerns in TV

[tbone]

I recently visited the Villages for the third time this last February and March and looked at homes with the intent of purchasing one. My wife was enamored with the Villages, and we made an offer on a property in Spanish Springs.

While discussing insurance coverage with several insurance agents, it became evident that there is the potential of substantial out of pocket expenses if one is unfortunate enough to have a sinkhole on their property. Florida catastrophic coverage (included with standard Florida policies) does offer some protection, but certain conditions must apply including direct damage to a property by a visible sinkhole.

Possible exposure exists in the event a homeowner does not have non-catastrophic coverage, an optional endorsement added to a standard insurance policy. I received ballpark quotes of $300-$500/year for this coverage, but found that the home made an offer on was NOT eligible for this coverage. (Even if they purchase from an owner that has it in effect on the property they are purchasing and have grandfathered coverage.

It appears that most homes in the Villages are not eligible for this coverage on newly purchased homes, with the exception of zip code 32163 for homes built from 2013-present. Note: that information comes from The Villages Insurance Agency. AAA may offer more options, and recently, Florida's Governor signed a bill allowing for stand-alone non-catastrophic sinkhole coverage to be offered by insurance companies beginning in July.

I'm told that there will not be rush by insurers to enter the market.

So, in summary:

If your home is damaged by a visible sinkhole and condemned, etc., you probably have coverage under a standard homeowner's policy.

If no sinkhole is visible, just cracks in the walls, foundation, doors and windows that don't open, etc., if you have non-catastrophic endorsement, you have a 10% deductible (10% of the basic policy building coverage) before the insurance pays. On a $300,000 home, this would mean $30,000 out of pocket before the insurance kicks in. If you don't have the optional endorsement, you are on your own for the entire repair.

Now, here's another exposure I see that is not discussed very frequently. What happens if a sinkhole opens up on the corner of your property and is not within the confines of your dwelling's footprint? It appears to me that the exposure is entirely the Homeowner's responsibility. That could be VERY EXPENSIVE. (I read somewhere that the average sinkhole claim is over $80,000.)

To help prospective homeowners (and current owners) I have put together a list of internet links to various news articles and reference sources.

I've attached the pdf document to this post. Enjoy!

[outlaw]

I recently visited the Villages for the third time this last February and March and looked at homes with the intent of purchasing one. My wife was enamored with the Villages, and we made an offer on a property in Spanish Springs.

While discussing insurance coverage with several insurance agents, it became evident that there is the potential of substantial out of pocket expenses if one is unfortunate enough to have a sinkhole on their property. Florida catastrophic coverage (included with standard Florida policies) does offer some protection, but certain conditions must apply including direct damage to a property by a visible sinkhole.

Possible exposure exists in the event a homeowner does not have non-catastrophic coverage, an optional endorsement added to a standard insurance policy. I received ballpark quotes of $300-$500/year for this coverage, but found that the home made an offer on was NOT eligible for this coverage. (Even if they purchase from an owner that has it in effect on the property they are purchasing and have grandfathered coverage.

It appears that most homes in the Villages are not eligible for this coverage on newly purchased homes, with the exception of zip code 32163 for homes built from 2013-present. Note: that information comes from The Villages Insurance Agency. AAA may offer more options, and recently, Florida's Governor signed a bill allowing for stand-alone non-catastrophic sinkhole coverage to be offered by insurance companies beginning in July.

I'm told that there will not be rush by insurers to enter the market.

So, in summary:

If your home is damaged by a visible sinkhole and condemned, etc., you probably have coverage under a standard homeowner's policy.

If no sinkhole is visible, just cracks in the walls, foundation, doors and windows that don't open, etc., if you have non-catastrophic endorsement, you have a 10% deductible (10% of the basic policy building coverage) before the insurance pays. On a $300,000 home, this would mean $30,000 out of pocket before the insurance kicks in. If you don't have the optional endorsement, you are on your own for the entire repair.

Now, here's another exposure I see that is not discussed very frequently. What happens if a sinkhole opens up on the corner of your property and is not within the confines of your dwelling's footprint? It appears to me that the exposure is entirely the Homeowner's responsibility. That could be VERY EXPENSIVE. (I read somewhere that the average sinkhole claim is over $80,000.)

To help prospective homeowners (and current owners) I have put together a list of internet links to various news articles and reference sources.

I've attached the pdf document to this post. Enjoy!

Thanks for the attached info. You are new here, so brace yourself. You will probably be called a scaremonger and questioned about your motives for just bringing up the subject of sinkholes in TV. Good luck.

[jnieman]

So did you go through with your contract knowing all of what you mentioned in your post? Since the subject of sinkholes has been discussed at length on this forum many of us have already weighed the pros and cons of purchasing in Florida.

When I lived in Ohio before I moved here I knew we were at risk for sinkholes and hurricanes. You take your chances, but there are risks all over the country of one kind or another, so it's pretty much a crap shoot. When we bought our home sinkhole coverage was available on most new builds. You might check with a couple of other agencies besides the Villages Insurance. They don't write homeowners insurance for ALL Florida companies. I suggest checking for one with AAA, and maybe even Allstate. They write for several Florida companies as well.

[photo1902]

I recently visited the Villages for the third time this last February and March and looked at homes with the intent of purchasing one. My wife was enamored with the Villages, and we made an offer on a property in Spanish Springs.

While discussing insurance coverage with several insurance agents, it became evident that there is the potential of substantial out of pocket expenses if one is unfortunate enough to have a sinkhole on their property. Florida catastrophic coverage (included with standard Florida policies) does offer some protection, but certain conditions must apply including direct damage to a property by a visible sinkhole.

Possible exposure exists in the event a homeowner does not have non-catastrophic coverage, an optional endorsement added to a standard insurance policy. I received ballpark quotes of $300-$500/year for this coverage, but found that the home made an offer on was NOT eligible for this coverage. (Even if they purchase from an owner that has it in effect on the property they are purchasing and have grandfathered coverage.

It appears that most homes in the Villages are not eligible for this coverage on newly purchased homes, with the exception of zip code 32163 for homes built from 2013-present. Note: that information comes from The Villages Insurance Agency. AAA may offer more options, and recently, Florida's Governor signed a bill allowing for stand-alone non-catastrophic sinkhole coverage to be offered by insurance companies beginning in July.

I'm told that there will not be rush by insurers to enter the market.

So, in summary:

If your home is damaged by a visible sinkhole and condemned, etc., you probably have coverage under a standard homeowner's policy.

If no sinkhole is visible, just cracks in the walls, foundation, doors and windows that don't open, etc., if you have non-catastrophic endorsement, you have a 10% deductible (10% of the basic policy building coverage) before the insurance pays. On a $300,000 home, this would mean $30,000 out of pocket before the insurance kicks in. If you don't have the optional endorsement, you are on your own for the entire repair.

Now, here's another exposure I see that is not discussed very frequently. What happens if a sinkhole opens up on the corner of your property and is not within the confines of your dwelling's footprint? It appears to me that the exposure is entirely the Homeowner's responsibility. That could be VERY EXPENSIVE. (I read somewhere that the average sinkhole claim is over $80,000.)

To help prospective homeowners (and current owners) I have put together a list of internet links to various news articles and reference sources.

I've attached the pdf document to this post. Enjoy!

Thank you for the informative post. This was new to us when we moved to Florida and purchased a new home in zip code 32163 in late December. I was aware of sinkholes, and our insurance agent explained the policies.

[graciegirl]

Before 2011 Home Insurance covered a lot more of sink hole damage and so every crack and inperfection was turned in to insurance and in many cases the damage had nothing to do with ground collapse. Insurance was being scammed and incorrectly used and as a result the law changed for the whole State of Florida.


Florida Sinkhole Laws, Statutes, Remediation :: Major Changes Made to Existing Sinkhole Statutes (http://www.sinkholeattorney.com/legislative-update.htm)


The Villages is in a zone that has more sinkholes, but Sumter County is seventh in number of sinkholes in Florida.


Before you move here it is wise to know that we have more lightning strikes than any other area of the country in central Florida. There are other dangers too that are tied into living here. More sun exposure makes Melanoma a greater possibility. However, in The Villages, few unplanned pregnancies occur.


On the coast, Hurricane insurance is very high. People are terrified of dying in a natural event, but there is little we can do to avoid them. They are everywhere. I like this place better than the San Andreas fault. We get to choose where we live but there is DANGER EVERYWHERE FROM SOMETHING.


Here in The Villages we seem to have a history of one or two bad sinkholes every year affecting someone's home but I can only remember one being condemned in the nine years we have lived here. Anybody disagree?

[photo1902]

Before 2011 Home Insurance covered a lot more of sink hole damage and so every crack and inperfection was turned in to insurance and in many cases the damage had nothing to do with ground collapse. Insurance was being scammed and incorrectly used and as a result the law changed for the whole State of Florida.


Florida Sinkhole Laws, Statutes, Remediation :: Major Changes Made to Existing Sinkhole Statutes (http://www.sinkholeattorney.com/legislative-update.htm)


The Villages is in a zone that has more sinkholes, but Sumter County is seventh in number of sinkholes in Florida.


Before you move here it is wise to know that we have more lightning strikes than any other area of the country in central Florida. There are other dangers too that are tied into living here. More sun exposure makes Melanoma a greater possibility. However, in The Villages, few unplanned pregnancies occur.


On the coast, Hurricane insurance is very high. People are terrified of dying in a natural event, but there is little we can do to avoid them. They are everywhere. I like this place better than the San Andreas fault. We get to choose where we live but there is DANGER EVERYWHERE FROM SOMETHING.


Here in The Villages we seem to have a history of one or two bad sinkholes every year affecting someone's home but I can only remember one being condemned in the nine years we have lived here. Anybody disagree?

Im still laughing at the "unplanned pregnancies" comment

[tbone]

Thanks, everyone, for the comments.

In addition to having owned a property and casualty insurance business, I had the misfortune to own a gulf-front rental condo that was hit by two hurricanes and one tropical storm. I know firsthand what risk is. The insurance company essentially "renewed" our property to better than it was before the storms, so although it was very inconvenient, we were OK financially.

We did not end up purchasing the Spanish Springs property for two reasons: One was the non-availability of the sinkhole endorsement in that area, and second was there were a number of ladder cracks, trim cracks, one at the edge of a window and a porch door that didn't open correctly. (crack in concrete from settling nearby) My gut said no on that one, so we did not pursue it.

I have no issue with risk (such as lightning) if insurance can be procured to cover that risk. Exposure that is not insurable is more problematic. Most people would be quite upset with the prospect of coming up with an extra $80,000 in their monthly budget if they had a sinkhole open up on their property. (or even if a smaller $20-30,000 loss occurred that's covered by the non-catastrophic 10% deductible coverage.)

In a similar vein, how comfortable would people feel if fire damage to their home were excluded by their company due to a lightning strike?

Perhaps the developer has stepped in to fill sinkholes that occurred on private property near a street, path, etc., because it created a safety hazard. This would mitigate the exposure.

I talked to a lot of people during my visit and got the impression that most are not aware of their potential sinkhole exposure. Hopefully, helpful comments posted in this thread will serve to enlighten them. (And are welcomed!)

Again, thanks to all for your input.

[Paper1]

It is pretty sad that due to abuse by home owners and the upstanding Florida legal community we cannot buy reasonably priced sinkhole insurance. If you add the cost of sinkhole damage in Villages over last 10 years and spread that cost over the number of home owners I suspect it would be a pretty low number. What am I missing?

[goodtimesintv]

"My wife was enamored with the Villages, and we made an offer on a property in Spanish Springs."

I hope your wife gets the chance to live here, and does not have to wait around for natural disasters to ruin her life elsewhere.

Somehow, 115,000 people in The Villages are learning to live their lives with the insurance that is available to us.

----------

"Police in Central California captured the moment a gigantic sinkhole opened up in a residential neighborhood Monday evening."
Video Captures Giant Sinkhole Collapse in California Neighborhood - ABC News (http://abcnews.go.com/US/video-captures-giant-sinkhole-collapse-ca-neighborhood/story?id=38325129)

"Drone footage shows stunning footage of a 100-foot-deep Missouri sinkhole on the edge of the Top of the Rock golf course."
Drone footage shows 100-foot-deep sinkhole (http://www.usatoday.com/story/tech/nation-now/2016/02/18/drone-top-of-rock-sinkhole/80560176/)

QUEEN CREEK, Ariz. — A woman who was outside gardening saw an irrigation worker disappear into a sinkhole that suddenly opened behind his truck a few hundred yards from where she was standing.
Woman in her garden saw sinkhole swallow man (http://www.usatoday.com/story/news/nation-now/2016/02/08/arizona-sinkhole/79990466/)

[Barefoot]

Before you move here it is wise to know that we have more lightning strikes than any other area of the country in central Florida. There are other dangers too that are tied into living here. More sun exposure makes Melanoma a greater possibility. However, in The Villages, few unplanned pregnancies occur.

On the coast, Hurricane insurance is very high. People are terrified of dying in a natural event, but there is little we can do to avoid them. They are everywhere. I like this place better than the San Andreas fault. We get to choose where we live but there is DANGER EVERYWHERE FROM SOMETHING.
As Gilda said, "It's always something".

[Nucky]

Grip replacement on the ball retriever because of cheap skate retrieving a golf ball from a prohibited area is now in #2 position as post of the year so far for 2016. However, in The Villages, few unplanned pregnancies occur. :1rotfl: In the leading position for post of the year so far for 2016, gonna be hard to beat. I'm going to roll the dice and buy anyway, I'm looking to live on the edge and be risky after a life of over thinking everything. Everyone has decisions to make I think we'll be fine. There are many smart people who plunked down a suitcase full of $$$$Cash$$$$ in TV before me. No Paralysis of Analysis Here.

[tbone]

Thanks for the great comments and thanks for the other sinkhole links.

Hopefully this thread will be a useful reference going forward.

Remember the old joke:

Q: What is the difference between ignorance and apathy?
A: I don't know and I don't care.

[kstew43]

you can always rent a home instead of buying. Maybe a little more expensive, but....sink holes will be the landlords problem.

just a thought..