In the ever changing world of sinkhole law, we always see tweaks to policies and some insurance companies may have their policies read slightly different than others. Most insurance policies will read very similar to all the others because usually insurance policy language has to be approved by the Office of Insurance Regulation before it goes out to homeowners. Recently however we have seen different usage of the term “structural damage”. We all know the statute changed in 2011 and provided a very detailed, and probably confusing, definition of what structural damage means but, not all insurance companies have used that defintion
The general law here in Florida is that when you write an insurance policy you can make it more broad than what the statutes say you should do but you can not make it more narrow. In other words if the statutes say you have to prove A, B and C to get coverage under the policy you can write a policy that says you only have to prove A and B but not one that says you have to prove A, B, C and D. I think too many people, lawyers, judges and experts included, believe that the statutes on sinkholes are the gospel. That is not the case, the insurance policy is the gospel.
With that being said, some insurance policies (we have seen some from Tower Hill for example) will state that structural damage is defined as “damage that has affected the ability of the building or foundation to carry loads for which it was designed”. That is a very different definition than what the statutes say but most would agree that it is more broad, meaning it is easier to prove than the statute is. I can not speak for sure but it appears that carriers are using this language as a stop gap of sorts. Maybe because they have not had the opportunity to change the policy to include the new statutory language. Either way, it serves as a reminder to always read your policy first and foremost. Most sinkhole endorsements are only a page or two long, it amazes me how many people never read it. It all begins and ends with what the policy says.