Why you could lose sinkhole insurance coverage

Once you go through the time and effort of educating yourself on sinkhole insurance and can be confident that you’ll be covered in the case that a sinkhole opens up beneath your home, there are situations in which your sinkhole insurance coverage is canceled, and for reasons you might not expect. For example, did you know your insurance may be canceled if you’ve filed a claim and it’s getting expensive?

When losing sinkhole insurance coverage is legal

The most obvious and common reason that insured lose their sinkhole insurance coverage is in the event that they fail to pay their premium on time. Check your policy: if you take too long to pay for your homeowner’s insurance, you could lose it!

In this case, if you happen to get a sinkhole, your insurance company may provide you with lesser coverage: catastrophic coverage. However, do not get your hopes up, as catastrophic coverage only kicks in when a sinkhole makes your home unhabitable. That being said, paying your premium could be the only thing keeping your home and your family from homelessness, debt, etc.!

When it’s not legal

A sinkhole claim can prove to be a long, arduous process, sometimes requiring a variety of separate stages like subsurface investigation, the initial cosmetic estimates, the subsurface remediation, more cosmetic estimates, and an evaluation of other potential repair methods.

Of course, to an insurance company, a  longer, more complex claim means more money that they have to cover. We’ve seen an unfortunate trend where insurance companies will flag these claims, and canceling or non-renewing their insureds’ policies while they’re in the midst of processing a claim. Even the most dependable, loyal insureds have seen their sinkhole insurance coverage stop in the middle of an already difficult situation.

Florida Statutes say that this may not be legal and we are representing more and more homeowners who want to take action. If your homeowner’s insurance has been canceled or non-renewed because of a sinkhole claim you filed, feel free to contact our office to discuss if you have a claim against your carrier.

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