All too often our agency hears someone refer to sinkholes as a mythical type event that is so uncommon and unheard of that you are basically throwing away your money to have sinkhole coverage on your policy.

Sinkholes really are possible and sinkhole coverage is something that everyone should consider.  Standard property policies in Florida (including homeowners policies and dwelling policies) include coverage for Catastrophic Ground Cover Collapse.  This coverage applies when all of the following four items occur (this is taken from State of Florida definitions):

1.      The abrupt collapse of the ground cover;
2.      A depression in the ground cover clearly visible to the naked eye;
3.      Structural damage to the building, including the foundation; and
4.      The insured structure being condemned and ordered to be vacated by the governmental agency authorized by law to issue such an order for that structure
 

A building can be damaged by sinkhole activity that does not meet all four criteria above for catastrophic ground cover collapse.  For instance, a home may still be livable, but there may be foundation cracks, wall cracks, pool cracks, doors and windows that don’t work properly, and/or broken pipes from foundation shifts.  These items can be extremely costly to repair and will not be covered by a property policy unless a Sinkhole coverage endorsement is added to the policy.

We strongly urge anyone to seriously consider sinkhole coverage for their policy so they know what may or may not be covered.

Here are some links to the state of Florida that more fully discusses sinkholes and where and how they occur.
http://www.dep.state.fl.us/geology/geologictopics/sinkhole/florida_sinkhole_poster.pdf
http://www.swfwmd.state.fl.us/hydrology/sinkholes/