Sinkhole victims say resort will not reimburse them for losses

Florida’s sinkhole problem is continuing to garner national media attention. A massive sinkhole that opened just six miles from Walt Disney World last month has recently graced headlines. While the Magic Kingdom may have been spared, the estimated 40-to-60 foot sinkhole wrecked the vacation homes of many as it partially swallowed several buildings at the Summer Bay Resort in Lake County.

Fortunately, no one was killed or injured as a result of the sinkhole activity.

Last week, demolition started on what remains of the three buildings that collapsed into the sinkhole. The structures housed time-share condominiums, and some of them were occupied when the sinkhole opened on Aug. 11.

Many of the vacationers have complained that the resort is not going to reimburse them for their losses, including theme park tickets, cash, electronics and other personal belongings.

The company’s CEO and president told a news reporter shortly after the sinkhole opened that the company would reimburse guests for their damages, but later sent guests a letter stating that the resort would not cover any personal property losses. The letter suggested that guests look into the possibility of filing claims under their own homeowners’ insurance policies.

While many homeowners’ policies do cover personal property losses due to fires or thefts during vacation, few people outside of Florida have sinkhole riders on their homeowners’ insurance. And, even in Florida, there are many people who do not have this important coverage.

It is unclear what type of sinkhole damage coverage the Summer Bay Resort has; it has been estimated that the demolition alone will cost about $87,500. The total amount of the resort’s losses has not been reported.

This case is yet another example of the very costly damages that sinkholes can cause. Even when people do have sinkhole coverage, insurance companies often refuse to pay claims or they underpay claims. Victims of sinkhole damage may benefit from seeking legal counsel to ensure that they obtain any compensation to which they may be entitled.

Source: Orlando Sentinel, “Summer Bay begins demolishing sinkhole-damaged buildings,” Stephen Hudak, Sept. 4, 2013

Source: Orlando Sentinel, ” Sinkhole victims: Summer Bay reneging on promise to pay for losses,” Stephen Hudak, Aug. 28, 2013