South Florida Sun-Sentinel
Editorial
January 10, 2011
THE ISSUE: Sinkhole damage claims rise.
Just wonderful. If Florida didn’t have enough of an insurance bullseye during hurricane season, we now seem to have to worry about the ground below our feet, and homes.
Or better said, the ground not there due to sinkholes.
We’ll skip the geology session, and just point out data reported by the state Office of Insurance Regulation. An OIR survey found a sharp increase in the number of sinkhole-related damage claims over a four-year period — from 2,360 in 2006 to 6,694 last year — filed with 211 private insurers.
What gives? It’s not clear. Geologists who met with the Senate Banking and Insurance Committee said they found no scientific reason behind the increase in claims.
That’s comforting, but not that the dollar figures involved are rising. The cost for sinkhole claims paid out by private insurers totaled $1.4 billion. And state-run Citizens Property Insurance Corp. paid out $84 million in claims in 2009, while taking in just $19.6 million in sinkhole claims.
Not extraordinary year-to-year numbers, but enough to warrant attention, especially if scientists can’t point their finger at some geological factors at work.
So lawmakers would be wise to consider a series of recommendations issued by the Senate committee. Those include:
Establishing a sinkhole repair program to fix damaged properties instead of issuing checks to homeowners, who insurers say often don’t use money paid in claims to make repairs.
Set guidelines on what constitutes damage from sinkoles. Many claims don’t involve headline-grabbing sinkholes that swallow property, but rather just cracks in walls and other maladies that are difficult to link to sinkholes.
Revise Florida’s building codes to require soil testing and foundation construction to reduce the risk of sinkhole-type damage to homes.
Floridians should learn a lesson here from the post-hurricane experience with insurance chaos. Namely, that it’s better to make reforms and take preventive measures before costs and damages spiral out of control.
Again, geologists say nothing has changed underground. So lawmakers have time to tweak laws and institute better policies. They should use that time wisely.
BOTTOM LINE: Tweak laws and codes now.
http://www.sun-sentinel.com/news/opinion/editorials/fl-sinkholes-insurance-editorial-af-20110110,0,4222770.story
