Sinkhole vs. Catastrophic Ground Collapse? Here’s How Florida Home Insurance Claim Sees Them

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Sinkholes can be deadly. Families often have to leave without time to grab photo albums, pictures off the walls, or important documents.

If you live in Florida, you may find yourself wondering about the difference between a sinkhole vs. catastrophic ground collapse. While there aren’t many physical differences between sinkholes vs. catastrophic ground collapse, there may be some distinct differences when it comes to your insurance policy.

Here we will look at sinkholes vs. catastrophic ground collapse to find how insurance responds to them and what homeowners can do to tell the difference between sinkhole vs. catastrophic ground collapse.

What is a sinkhole vs. catastrophic ground collapse?

To answer the question, “What is a sinkhole vs. catastrophic ground collapse?” we should first understand what a sinkhole is. A sinkhole is a hole or depression that forms when the surface layer of the earth is collapsed or depressed.

Sinkholes can form anywhere including under homes, carports or sheds. They can also develop in the middle of nowhere and fill with rain forming lakes and ponds.

Florida is vulnerable to sinkholes and catastrophic ground collapse because of its geological formation. The state is mostly made up of carbonate rock under a thin layer of sand and clay. Over time, the carbonate rock can dissolve causing caves, sinkholes, and streams. As far as sinkholes vs. catastrophic ground collapse, the cause is usually due to Mother Nature.

A sinkhole vs. catastrophic ground collapse: What’s the damage?

When sinkholes form near or under homes, they can cause a myriad of problems, but as far as a sinkhole vs. catastrophic ground collapse, there is a big difference. From an insurance standpoint, a sinkhole vs. catastrophic ground collapse has to do with whether the policy will respond. Catastrophic ground collapse coverage is narrower and will kick in only when certain conditions are met. 

As far as damage to your home is concerned, you likely won’t care much for the difference between a sinkhole vs. catastrophic ground collapse. Both can be devastating to a homeowner. While catastrophic ground collapse may be more damaging, even small sinkholes can cause many problems for homeowners. 

When thinking about a sinkhole vs. catastrophic ground collapse, remember this: not every sinkhole leads to catastrophic ground collapse, and not every instance of catastrophic ground collapse has to do with a sinkhole.

Sinkhole vs. catastrophic ground collapse: Defined

As far as insurance goes concerning a sinkhole vs. catastrophic ground collapse, it didn’t really matter until 2007. Faced with growing sinkhole claims, the Florida legislature passed a statute which allowed insurance companies to amend their sinkhole coverage to include catastrophic ground collapse.

Since then, as far as a sinkhole vs. catastrophic ground collapse insurance coverage, the definitions have changed. Now policies come with coverage for catastrophic ground collapse but may not cover sinkhole damage.

Sinkhole vs. catastrophic ground collapse: What Florida insurance covers

Sine the legislation changes in 2007, the questions about a sinkhole vs. catastrophic ground collapse are clearer, but not always in favor of the homeowner. For your Florida insurance policy to respond to a catastrophic ground collapse claim, the event must meet several conditions as follows:

  • The hole or depression must have occurred abruptly
  • There must be a visible depression in the ground that can be seen without special instruments or equipment
  • The hole or depression must have caused structural damage to the home, including damage to the foundation
  • The house must have been condemned

As you can see, a sinkhole vs. catastrophic ground collapse may be a difference of severity. Sinkhole damage such as cracks in walls doesn’t qualify for coverage under a catastrophic ground collapse.

Sinkhole vs. catastrophic ground collapse: Coverage for sinkhole losses

As far as a sinkhole insurance coverage, Florida insurance companies offer sinkhole coverage for an additional premium, to some homeowners. The coverage is cost prohibitive for most. Even with the additional sinkhole coverage for purchase, conditions must be met for the policy to respond. A sinkhole vs. a catastrophic ground collapse claim must include:

  • Structural damage to the home including the foundation
  • Foundation movement that is greater than the building code acceptable limit
  • Foundation movement that makes the building not able to maintain its designated load

Sinkhole vs. Catastrophic Ground Collapse: What to look for

Still, sinkholes can cause many problems for homeowners without resulting in catastrophic ground collapse. Signs of a sinkhole may include:

  • Changes in the ground surface: If you notice changes in the surface of the ground near your home, you may have to start thinking about a sinkhole vs. catastrophic ground collapse
  • Ponds and puddles: The formation of new lakes or ponding water on your property can be an indication of a sinkhole. Whether it’s a sinkhole vs. catastrophic ground collapse will depend on where the depression is located and the extent of the damage.
  • Slumped over trees: Sinkholes on your property can cause trees to sink or fall completely over.
  • Dead patches of grass: When groundwater is carried away from the surface of the earth as when a sinkhole forms, it can leave the area without water. Look for dead grass and vegetation on your property
  • Cracks in the outside ground: An early warning sign of a sinkhole is sometimes a round formation of cracks in the ground’s surface. The cracks are formed when the area sinks.

Sinkhole vs. catastrophic ground collapse: A growing problem with shrinking coverage

Most homeowners don’t care if it’s a sinkhole vs. catastrophic ground collapse that has caused damage to their home. So as far as coverage for a sinkhole vs. catastrophic ground collapse, the definitions are narrow. In both cases, the loss must be structural. Other limitations when making a sinkhole vs. catastrophic ground collapse claim include:

  • Paying the additional premium for the sinkhole overage
  • Agreeing to an inspection of the home to ensure there have been no previous losses
  • Limitation on coverage, such as covering only the main structure on the property
  • Agreeing to a large deductible – sometimes as high as 10 percent of the policy limit.

Sinkhole vs. catastrophic ground collapse claims

Sinkhole vs. catastrophic ground collapse claims can be complicated. If you need help with your claim or understanding your coverage, contact us.

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