Florida Soldier Struggles to Recover From Insurer After Sinkhole Damages his Home

While sinkholes may be fascinating to geologists, they are a nightmare for homeowners. Whether a few feet or many meters wide, these geological minefields can swallow cars, destroy homes and cause financial ruin. For homeowners, insurance claims could have been a band-aid for some of the burden of repairing homes; however, in Florida, the terrain has gotten rough and no one knows this better than Army Private Juan Espinosa and his family.

Living in Pasco County, Florida, the Espinosas bought their home and soon found that things literally began falling apart. The foundation and the walls of the home cracked. Water leaked through a window. When the Espinosas sought professional help, an engineer linked the problem to a sinkhole. Turning to their insurer for help, the Espinosas were denied, and they struggle to fix a now inhabitable home.

Espinosa is not alone in his plight. There are thousands who have filed insurance claims for similar problems. In 2010, a vast majority, 85 percent, have been denied. Interestingly enough, the insurance industry believes that many claims are more related, and that the industry has fallen victim of epidemic sinkhole fraud.

Sinkholes occur in many states across the country; however, Florida is more prone to problems because of underground limestone that erodes over time and, under certain conditions, simply collapses. According to the Herald-Tribune, analysis of sinkhole claims since 2005 reveal that 75 percent of claims involve properties within one mile of confirmed sinkholes and other ground movement. The remaining 25 percent relate to properties that were beyond five miles of reported sinkhole-related activity.

Florida’s legislators, hearing the concerns of insurers and not the insured, recently enacted revisions to property insurance laws. Under its Senate Bill 408, which became law in May 2011, the Sunshine State’s legislators curtailed protections for consumers. The law deregulates insurance premiums for sinkhole coverage among other things.

Sinkholes are a problem for homeowners, who do not know how to detect structures built on this ancient underground limestone caves. While proper insurance coverage may have been a remedy in the past, recent laws may have made the issue more problematic for Floridians. As a result, people like the Espinosas struggle financially to fight geological nightmares as their insurance carriers turn a blind eye.