How do I know if and/or when I should file a sinkhole claim?

Deciding to file a sinkhole claim for settlement damage is either really easy or really hard. The reason being that it is really easy if the damage to the home is immediate, material, and creating a potentially damaging environment for you and your family.

Conversely, if the damage is mild to moderate, located in isolated areas of your home, or just is not creating a specific problem for you, you may be mulling over whether you want to file a claim.

Questions you should be asking

The answer as to “when” to file a claim always depends on each situation. But, having said that, here are the primary issues you should resolve:

  1. If I file a sinkhole claim, and it turns out not to be a sinkhole, then what? Will my insurance be canceled?
  2. If I file a claim and there IS a sinkhole or sinkhole activity, then what?
  3. If I decide to wait and file a claim, does this impact my rights under my policy?

The answer to the question, if the investigation is a no, can be troubling. First, if you seek damage consistent with sinkhole activity (e.g. stair-step cracks, floor cracking, or doors “racking”), the insurance company is obligated under Florida law to investigate whether the damage is sinkhole related.

What your insurance company will do

Your insurance company will hire a sinkhole investigation company to conduct various engineering studies at your home, and a copy of the report will be provided to you. If they do not find sinkhole activity, then you will be told the most likely cause of the damage.

If you are not a “regular” filer of insurance claims, there is not usually a consequence, unless they determine there is something else, not insured, which you have to remedy.

What to be prepared for

If the investigation determines the cause of the damage IS sinkhole activity, be prepared for a ride. Most home insurance companies do a very poor job of managing sinkhole claims where there has been confirmed sinkhole activity.

In counties like Marion, Hernando, Pasco, and Pinellas, things can also be complicated by suggestions in the engineering report that the damage resulted from sinkhole activity and something else (e.g. expansive clay, organics). There is also a chance you will be arguing over underpinning versus grouting, for the subsurface repairs.

In most cases, insurance companies do not want to use underpinning, because it is expensive and often causes other damage to the house during the installation. This is one of the most common disputes among our clients, in all of the heavy counties where sinkhole claims are filed.

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