In 2006, Florida lawmakers created the “Neutral Evaluation Process” in an effort to help Floridians resolve sinkhole insurance disputes. Specifically, this process allows both homeowners and insurance providers to request an evaluation of sinkhole damage by a neutral evaluator should a disagreement arise regarding a Florida sinkhole insurance claim. Ultimately, this evaluation concludes with a report outlining whether sinkhole activity actually caused the damage in question and the possible courses of action that should be used to remediate the damage.
Sadly, however, this entire process has not only led to various concerns regarding the “neutrality” of evaluators, but also the process’s effectiveness in actually resolving sinkhole disputes given that insurance companies are free to simply ignore the recommendations of the neutral evaluators.
Neutral Evaluator Qualifications in Florida
Under the neutral evaluation process, Florida’s Department of Financial Services (DFS) is responsible for certifying and maintaining a list of all neutral evaluators. The qualifications for being certified as a neutral evaluator are initially straightforward; for instance, all evaluators must complete an approved ADR course and be a professional engineer or geologist.
However, things become a bit more problematic when determining if neutral evaluators are going to be fair and impartial. This concern stems from the fact that a neutral evaluator can be considered fair and impartial so long as he or she does not obtain “more than 90 percent of [his or her] gross income or revenue in the prior calendar year from contracts with property insurers.”
So, theoretically an evaluator can still be considered “neutral” by the DFS even if he or she acquires an alarming 89 percent of his or her income from insurance companies – an amount that may make even the most trusting homeowners leery about an evaluator’s impartiality.
Insurance Companies Ignoring Neutral Evaluators’ Sinkhole Recommendations
Unfortunately, even in cases in which Florida homeowners are fortunate enough to be assigned a neutral evaluator that recommends beneficial sinkhole repairs, insurance companies are at liberty to merely ignore these recommendations. In fact, the Florida neutral evaluator statute states not once, but twice, that the entire process is not binding on the parties – meaning insurance companies are free to disregard the recommendations of the neutral evaluator if it so chooses.
For instance, if a neutral evaluator concludes that sinkhole activity caused the damage in question, but the insurance company’s expert disagrees, the insurance company can side with its own expert and deny the claim. Similarly, even if the insurance company agrees that the damage can be attributed to a sinkhole, they can ignore the repair recommendations suggested by the neutral evaluator and essentially attempt to force the homeowner to agree to its own suggested repairs – which will likely be cheaper and less effective.
However, even though this entire process appears to be a win-win situation for insurance companies, it does provide some options for homeowners. For example, Florida law expressly states that homeowners engaging in the neutral evaluation process “retain access to the court” – meaning they can still file a lawsuit if wrongfully denied adequate repairs or claims. Furthermore, if an insurance company’s denial of a claim is unsubstantiated by the neutral evaluation, the court will be provided this evidence given that all evaluator reports are admissible in legal proceedings.
Consequently, if your sinkhole insurance claim has been erroneously denied, it is generally advisable to contact an experienced sinkhole insurance claim attorney who can help ensure your rights are protected and assist with court proceedings if necessary.