Sink Hole insurance denied to re-sale buyers

[thomas47]

As a new villager who has just recently purchased a resale home, I was informed by 2 insurance companies that I have a 99.9 % chance of being denied sink hole insurance. The story goes you hire an engineering firm who comes out and examines the interior and exterior of your home. All ok go to step 2. Step 2 they then look at a 3 or 5 mile radius of your home and determine if there has been any suspect activity ( such as St. James Village) at this step 99.9% of sink hole applicants are denied insurance for there pre-owned homes. If your real estate agent is not telling you this you;d better ask up front. Talahassee needs to get involved if this is going on in the villages. Any one else having this problem? Let's get to the bottom of this and see if the insurance industry is acting in good faith and within the law.

[justjim]

As a new villager who has just recently purchased a resale home, I was informed by 2 insurance companies that I have a 99.9 % chance of being denied sink hole insurance. The story goes you hire an engineering firm who comes out and examines the interior and exterior of your home. All ok go to step 2. Step 2 they then look at a 3 or 5 mile radius of your home and determine if there has been any suspect activity ( such as St. James Village) at this step 99.9% of sink hole applicants are denied insurance for there pre-owned homes. If your real estate agent is not telling you this you;d better ask up front. Talahassee needs to get involved if this is going on in the villages. Any one else having this problem? Let's get to the bottom of this and see if the insurance industry is acting in good faith and within the law.

If this is true, it "hurts" our real estate values here in TV. However, everything being equal, if the home was previously insured for sink hole coverage it would be reasonable for it to be insured for sink hole coverage when the property is sold to another party. A different owner should not change the underwriting risk for the insurance company.

[janmcn]

As a new villager who has just recently purchased a resale home, I was informed by 2 insurance companies that I have a 99.9 % chance of being denied sink hole insurance. The story goes you hire an engineering firm who comes out and examines the interior and exterior of your home. All ok go to step 2. Step 2 they then look at a 3 or 5 mile radius of your home and determine if there has been any suspect activity ( such as St. James Village) at this step 99.9% of sink hole applicants are denied insurance for there pre-owned homes. If your real estate agent is not telling you this you;d better ask up front. Talahassee needs to get involved if this is going on in the villages. Any one else having this problem? Let's get to the bottom of this and see if the insurance industry is acting in good faith and within the law.

Tallahassee has been involved. The Florida Legislature is the one writing this legislation that allows insurance companies to create these loopholes.

This topic has been discussed many times on this forum, and sadly will only get worse. If sink hole insurance is important to buyers, they need to make it a contingency in their offer to purchase. However, as you stated, it is not available in 99.9% of cases.

Though not specific to sinkhole insurance, this article from today's newspaper reports what the legislature is working on today.


Property insurance rates could go through roof under Senate bill | Tampa Bay Times (http://www.tampabay.com/news/business/banking/property-insurance-rates-could-go-through-roof-under-senate-bill/2114444)

[thomas47]

If this is true, it "hurts" our real estate values here in TV. However, everything being equal, if the home was previously insured for sink hole coverage it would be reasonable for it to be insured for sink hole coverage when the property is sold to another party. A different owner should not change the underwriting risk for the insurance company.

Exactly, this house is less than 1 year old and had sink hole coverage by the original owners. Now I;m ready to close on the 17 of May and can't get coverage, Something smells

[thomas47]

Tallahassee has been involved. The Florida Legislature is the one writing this legislation that allows insurance companies to create these loopholes.

This topic has been discussed many times on this forum, and sadly will only get worse. If sink hole insurance is important to buyers, they need to make it a contingency in their offer to purchase. However, as you stated, it is not available in 99.9% of cases.

Though not specific to sinkhole insurance, this article from today's newspaper reports what the legislature is working on today.


Property insurance rates could go through roof under Senate bill | Tampa Bay Times (http://www.tampabay.com/news/business/banking/property-insurance-rates-could-go-through-roof-under-senate-bill/2114444)

This article deals with rate increases, We all know there only going to go up it's just by how much. What I'm talking about is denial of insurance regardless of rate amount. There' s something wrong here. How can they deny it and why isn't the real estate people here in the villages informing their clients of this?

[rockyisle]

We purchased our re-sale home 2 years ago and never had a problem getting all hazard insurance. If you haven't talked with the insurance agents in Sumter Landing, call them tomorrow. My brother just purchased a re-sale as well and has it.

[graciegirl]

Exactly, this house is less than 1 year old and had sink hole coverage by the original owners. Now I;m ready to close on the 17 of May and can't get coverage, Something smells

Please go up to search. Type in sinkhole coverage. or sinkhole insurance. It has been discussed many times.There was a new law passed in January and it makes it danged near impossible to get sinkhole insurance on a resale. It is NOT just in The Villages. It is in Florida

https://www.talkofthevillages.com/forums/villages-florida-general-discussion-73/another-sinkhole-insurance-thread-66651/

The Saga of Sinkhole Insurance in Florida - Law Firm Williams Law Association, P.A. Attorneys Tampa, Florida (http://www.sinkholelawyer.com/Insurance-Articles/The-Saga-of-Sinkhole-Insurance-in-Florida.shtml)

WE also have tornadoes, alligators, and this is the lightning capital of Florida. Just so you know.

[784caroline]

To clarify (I hope), Gracie is talking about sinkhole insurance related to gradual damage associated with sinkhole acitivty......NOT catistrophic sinkhole coverage which every policy in Florida should have.

[graciegirl]

To clarify (I hope), Gracie is talking about sinkhole insurance related to gradual damage associated with sinkhole acitivty......NOT catistrophic sinkhole coverage which every policy in Florida should have.

That is right and thank you my friend, for the correction.

[howardandsheila]

as it was explained to me, I could not get sinkhole insurance on the pre owned I just purchased, but I am covered for a "catastrophic ground collapse" IF the county condemns the house as uninhabitable. Decided I just don't want to worry about it. Statistics are on my side.

I don't have elephant stampede insurance either, but a man in Sumter Square sold me some elephant repellent and it has worked since ever since I sprinkled it all over the lawn. As a matter of fact, it keeps them away from my neighbor's yard too.

[sirknor]

My agent told me sinkhole insurance is available only to the original owner. I have it. But if i cancel it i don't think i can get it back.

[gustavo]

My agent told me sinkhole insurance is available only to the original owner. I have it. But if i cancel it i don't think i can get it back.

I had sinkhole coverage for two years as a new owner. My renewal this year will not include the sinkhole coverage. It cost $138/yr but there was a $40,000 deductible, so all being said, I don't need or want the coverage as I'm sure I can fix minor problems related to sinkholes with $40k and if its more than that the catastrophic ground collapse coverage will probably cover the damage.

[Mack184]

To clarify (I hope), Gracie is talking about sinkhole insurance related to gradual damage associated with sinkhole acitivty......NOT catistrophic sinkhole coverage which every policy in Florida should have.
Yes, she is. Also to the poster who said that the state needed to be involved, the state legislature is responsible for this when they passed insurance "reform" in the fall of 2011 which then took effect on 1/1/2012. Even NEW builds are effected depending on where you live and who your insurance carrier is. This is NOT a rumor, it is the truth. Your insurance agent can educate you about this, and you SHOULD get educated on these new laws.

[Mack184]

My agent told me sinkhole insurance is available only to the original owner. I have it. But if i cancel it i don't think i can get it back.
You can't if you drop it.

[gustavo]

.... The story goes you hire an engineering firm who comes out and examines the interior and exterior of your home. All ok go to step 2. Step 2 they then look at a 3 or 5 mile radius of your home and determine if there has been any suspect activity ( such as St. James Village) at this step 99.9% of sink hole applicants are denied insurance for there pre-owned homes. ...

My insurance co told me the cost of the inspection was $140, they would pay half. I decided I don't need sinkhole coverage with a $40k deductible.

[thomas47]

We purchased our re-sale home 2 years ago and never had a problem getting all hazard insurance. If you haven't talked with the insurance agents in Sumter Landing, call them tomorrow. My brother just purchased a re-sale as well and has it.

Hazard what you haveinsurance is not sink hole insurance. Better check

[thomas47]

Please go up to search. Type in sinkhole coverage. or sinkhole insurance. It has been discussed many times.There was a new law passed in January and it makes it danged near impossible to get sinkhole insurance on a resale. It is NOT just in The Villages. It is in Florida

https://www.talkofthevillages.com/forums/villages-florida-general-discussion-73/another-sinkhole-insurance-thread-66651/

The Saga of Sinkhole Insurance in Florida - Law Firm Williams Law Association, P.A. Attorneys Tampa, Florida (http://www.sinkholelawyer.com/Insurance-Articles/The-Saga-of-Sinkhole-Insurance-in-Florida.shtml)

WE also have tornadoes, alligators, and this is the lightning capital of Florida. Just so you know.
Yes I know and it doesn't rain in indianapolis in the summertime, but those things are insurable that you mention, not related to sink holes

[thomas47]

To clarify (I hope), Gracie is talking about sinkhole insurance related to gradual damage associated with sinkhole acitivty......NOT catistrophic sinkhole coverage which every policy in Florida should have.

So are you saying one kind of coverage is available and one is not? that isn't what we're being told

[thomas47]

That is right and thank you my friend, for the correction.

There's a big difference between should have and can have ladies.

[janmcn]

Go to any realtor's website, other than The Villages, and click on listings in Sunset Pointe. There is a house there for sale at 1631 Lakewood Drive, for $169,900 that had a sinkhole last year. The hole was just in front of the garage, so did not cause catistrophic ground collapse.

The hole has been filled in, but the owners elected to move out anyway. Now they're trying to sell and offering a lifetime guarantee against sinkholes, but nobody is buying.

[thomas47]

as it was explained to me, I could not get sinkhole insurance on the pre owned I just purchased, but I am covered for a "catastrophic ground collapse" IF the county condemns the house as uninhabitable. Decided I just don't want to worry about it. Statistics are on my side.

I don't have elephant stampede insurance either, but a man in Sumter Square sold me some elephant repellent and it has worked since ever since I sprinkled it all over the lawn. As a matter of fact, it keeps them away from my neighbor's yard too.

Must have gotten into the air because I am going ahead with my new house

[thomas47]

Must have gotten into the air because I am going ahead with my new house

P.S. as for statistics they'd be on your side even if you walked around the golf course during a lightening storm in metal spikes, but I wouldn't feel good doing it.

[gomoho]

This is life in Florida folks - spent Easter sunday at a beautiful beach house that does not have insurance because it would cost more than replacing the house (well pretty darn close anyway). And we have sinkholes - the thing that amazes me is why those in tornado alley don't have to have tornado insurance!

[GatorFan]

Part of catastrophic ground collapse does state your home has to be condemned. That simply means the county will require you move till repairs are made and home is safe to occupy. The same applies if you have a fire at your home and the county condemns your property due to electric damage and home is not safe to live in till repairs are made. Another way to look at difference is that catastrophic ground collage is visable and sinkholes are not. Catastrophic is included in all property policies in Florida by law with the same deductible as fire, lightning, etc.

[ilovetv]

Linked below is the Florida Office of Insurance Regulation page on Sinkholes, with links to other helpful info.

I would call them with questions.......

Sinkhole Page (http://www.floir.com/sections/pandc/sinkholepage.aspx)

[thomas47]

Part of catastrophic ground collapse does state your home has to be condemned. That simply means the county will require you move till repairs are made and home is safe to occupy. The same applies if you have a fire at your home and the county condemns your property due to electric damage and home is not safe to live in till repairs are made. Another way to look at difference is that catastrophic ground collage is visable and sinkholes are not. Catastrophic is included in all property policies in Florida by law with the same deductible as fire, lightning, etc.

This is the clarification I was looking for. Thank you neighbor

[Cantwaittoarrive]

Exactly, this house is less than 1 year old and had sink hole coverage by the original owners. Now I;m ready to close on the 17 of May and can't get coverage, Something smells

This is not new has been going on since the Florida legislature changed the law. Also keep in mind insurance companies are in business to make money not to insure people and pay out claims. The way they make money is by insuring risk and if the risk is too high they won't insure unless forced too by law. I think the change in the law is already effecting resale to some degree, I know two people that decided not to by in TV because of this issue

[graciegirl]

This is not new has been going on since the Florida legislature changed the law. Also keep in mind insurance companies are in business to make money not to insure people and pay out claims. The way they make money is by insuring risk and if the risk is too high they won't insure unless forced too by law. I think the change in the law is already effecting resale to some degree, I know two people that decided not to by in TV because of this issue


You meant in Florida? Why would they just bypass The Villages for such a wide spread issue? The sinkhole alley is in the the western central part. I will google a map of sinkholes in Florida.
http://www.securefsi.com/images/sinkholefaq/sinkholetype-near-map.jpg

[graciegirl]

There have been either seven or eight homes burnt to the ground in the last seven years in TV due to lightning strikes. We live in the lightning capital of the U.S. in central Florida.

World Lightning Strikes Map (http://geology.com/articles/lightning-map.shtml)

[JourneyOfLife]

Here is the other map illustration

Sinkhole Maps (http://www.suncitydave.info/sinkhole.htm)

Along with the poster that includes both maps

http://www.suncitydave.info/florida_sinkhole_poster.pdf

[JourneyOfLife]

Go to any realtor's website, other than The Villages, and click on listings in Sunset Pointe. There is a house there for sale at 1631 Lakewood Drive, for $169,900 that had a sinkhole last year. The hole was just in front of the garage, so did not cause catistrophic ground collapse.

The hole has been filled in, but the owners elected to move out anyway. Now they're trying to sell and offering a lifetime guarantee against sinkholes, but nobody is buying.


Does Florida law require that sinkhole problems have to be disclosed in writing before a real estate sale occurs?

http://www.dep.state.fl.us/geology/feedback/faq.htm#19
http://www.ehow.com/list_7181693_florida-sinkhole-disclosure-laws.html

I think it is amazing that it is not mandatory to disclose if the property had problems with sinkholes.

[Cantwaittoarrive]

You meant in Florida? Why would they just bypass The Villages for such a wide spread issue? The sinkhole alley is in the the western central part. I will google a map of sinkholes in Florida.
http://www.securefsi.com/images/sinkholefaq/sinkholetype-near-map.jpg

Well I said The Villages as that was the only place in Florida they were interested in moving too, but you are correct they would not have bought anywhere else in Florida.