Cornerstone’s Joshua Butts Discusses Sinkholes with WTSP 10 News
Sinkhole questions come up on nearly every home we insure in Pasco, Hernando, and Hillsborough, and we help you understand what your policy includes and what you can add. Here is what Joshua told WTSP and what has changed since.
Florida sinkhole insurance coverage is an important topic for homeowners across the state, where sinkholes are a fact of life. Sinkholes can appear suddenly and cause devastating damage to homes, foundations, and property. So is sinkhole damage automatically covered? Not always — Florida policies handle it in two very different ways. Read the latest from WTSP to learn more. Cornerstone Insurance agent and founder Joshua Butts was a featured contributor to the story.
What Florida Homeowners Should Know About Sinkhole Coverage
Many Florida homeowners are surprised to learn that standard homeowners insurance policies do not automatically include sinkhole coverage. Catastrophic ground cover collapse coverage is included in every Florida homeowners policy by law, but that is a narrow peril limited to a sudden collapse that condemns the home. Sinkhole-loss coverage, an optional endorsement, addresses structural damage from sinkhole activity that meets Florida’s statutory structural-damage test; cosmetic cracking on its own does not qualify, and the endorsement is not automatic. This is especially important for residents living in areas prone to sinkhole activity, including parts of Hillsborough, Pasco, and Hernando counties.
Florida sinkhole insurance coverage typically helps pay for structural repairs, foundation stabilization, and other costs associated with sinkhole-related damage. Without proper coverage, homeowners could face tens of thousands of dollars in out-of-pocket repair costs. Before issuing a sinkhole-loss endorsement, insurers can require a property inspection, and carriers often decline the endorsement based on what it finds, so offering it and approving it are two different things. When it is approved, approved endorsements typically carry a separate sinkhole deductible of 10 percent of your Coverage A dwelling limit, calculated on the limit rather than the claim (the statute allows 1, 2, 5 or 10 percent). Insurance companies in Florida are required by law to offer sinkhole coverage as an add-on to your policy, but it is not automatically included.
If you live in a sinkhole-prone area, it is essential to review your current homeowners insurance policy with your agent. A qualified independent insurance agent can help you understand your options and find the right level of coverage for your home and budget. Do not wait until damage occurs to find out whether you are protected.
Go deeper: the full sinkhole coverage guide
Since this story aired we have published a complete guide that walks through both coverages in detail — the four conditions a catastrophic ground cover collapse claim must meet, how the optional sinkhole endorsement and its 1%, 2%, 5%, and 10% deductible choices work, and what we see in the Sinkhole Alley counties: Sinkhole Insurance in Florida: Coverage vs Ground Cover Collapse.
Contact Cornerstone Insurance today to discuss your Florida sinkhole insurance coverage options and make sure your home is properly protected. Get a free quote to compare your options, or call or text 813.920.8181.
This story FAQ
Does every Florida homeowners policy cover sinkholes?
Every Florida policy includes catastrophic ground cover collapse, a narrow coverage for a sudden collapse that leaves the home condemned. Broader sinkhole loss coverage, which addresses cracking and foundation damage from sinkhole activity, is an optional endorsement.
How much is the sinkhole deductible?
Florida law sets the sinkhole loss deductible at 1, 2, 5 or 10 percent of the dwelling limit, with larger premium discounts for the higher percentages.
Can a carrier require an inspection before adding sinkhole coverage?
Yes. Insurers can require a property inspection before issuing the endorsement, and prior sinkhole activity found during it can lead to a decline or conditions on the coverage.
Which counties have the most sinkhole activity?
Pasco, Hernando and Hillsborough counties, north and east of Tampa, are known as Sinkhole Alley because of the dissolving limestone beneath them.