Where or not homeowners are entitled to monetary awards or whether they are forced to actually repair their home with any insurance benefits paid out has been a hotly contested debate for years. The debate stems from language in the sinkhole statutes that says insurance companies do not have to issue payment for the “sinkhole” or below ground repairs until the homeowner enters into a contract with a contractor to start those repairs. Then, and only then, will the insurance company release that money which will payable directly to the contractors. In Florida, centuries of common law dictates that when you have a contract and someone breaches that contract, they can no longer come back and force the other person to comply with their part of the contract. That was the argument in these cases. “Look insurance company, you didn’t do what you were supposed to do first so now its too late to come tell me what I have to do”. In the past year there have been several decisions from Florida appellate courts on this issue. All of the decisions have been pretty decisive that yes, homeowners will have to repair their homes even if their own insurance breached the contract first. Unless the issue is accepted by the Florida Supreme Court, this issue is relatively established now in Florida law and insurance companies will use it to their advantage.
The law and reality are not always one in the same. The reality is some insurance companies will stand strongly behind this proposition while others not so much. It really depends on the insurance company and the situation. If it appears to be twice the policy limits to repair a home, most insurance companies would prefer not to repair it and save the money by just paying you the policy limits. Some insurance companies just flat don’t have it in their business model to spend the time and money repairing the sinkholes and would prefer to resolve their cases via a cash settlement. Others, like Citizens, absolutely stand strong behind the right to force repairs because Citizens has a very different business models than private insurance companies do. Every situation can be unique but from the Court’s perspective, if your insurance company wants to force you to repair, they can.