These are actual photographs of damage to the ceiling and walls of one of my client’s homes. A carrier denied this sinkhole claim based on a report from an engineering firm that opined that the damage wasn’t caused by sinkhole activity. In addition to the numerous 2-4” wide openings to the walls and floors of the home, the floor elevation survey revealed a 7.25 inch floor elevation differential. Note that these photos show only a fraction of the actual damage to the house. Indeed, several veteran attorneys on both sides of the case and a well-respected retired judge who mediated the case all agreed that this was one of the worst sinkhole damage cases that they had come across.
Despite the numerous indicators of sinkhole activity and the widespread damage, an engineer hired by the insurance company signed his name to a report stating that there was no sinkhole activity. On April 3, 2010, the Florida Legislature introduced proposed legislation that would make the engineering report in a case like this the gospel truth. Specifically, the new legislation provides a strengthened presumption that the carrier’s engineer or geologist is always right. Yes, that’s what I said – the carrier’s engineer is ALWAYS presumed to be right, even in the face of overwhelming evidence that he is wrong!
Florida Statute section 627.7073 has always included a presumption that the findings of the carrier’s engineer or geologist are correct. That presumption, however, was merely a presumption that could easily be rebutted by a competent counter-opinion. The new proposed legislation, however, goes far beyond a mere presumption, it elevates the presumption and actually shifts the burden of proof to policyholders on sinkhole claims! Nowhere in the long history of Florida insurance law has the legislature ever singled out a specific kind of loss and, year after year, eroded the policyholders’ rights to recover under their policy (a policy that they pay good money for year after year, by the way) for that type of loss. The previous changes to sinkhole claims that provided for neutral evaluation, gave carriers the right to force clients to sign contracts before paying for repairs, etc., were bad enough for policyholders to endure. But now, this? We must put a stop to this type of legislative favoritism to insurance carriers.
The intent of the Legislature in shifting the burden of proof in sinkhole claims shows the Legislature’s allegiance. Legislators state that they are shifting the burden of proof to address “public policy concerns related to the availability and affordability of sinkhole coverage to provide consistency in claims handling and reduce the number of disputed sinkhole claims.” WHAT?? Do you know how many “disputed” sinkhole claims are real, actual, viable sinkhole claims where the carrier’s engineer has stretched the outer limits of creativity in denying sinkhole activity?
In the case above, for example, the home was built in 1972. In 2003, the home was still in pristine condition. Then, in 2006, something happened and the home shifted and twisted and huge gashes and cracks appeared in the house. The carrier’s engineer said that this was caused by shrink-swell clay activity. Note that any clay under the home would have been there since the home was built in 1972. The explanation was laughable and the carrier is actively working on resolving this claim now that they have considered how the engineer’s opinion will fare in front of a jury. Under the new legislation, my client would have a much tougher road to hoe to prove that the insurer’s paid engineer is wrong. I can only surmise from the proposed legislation, that the Legislature wants people like my clients to just go gently into that good night and not question or challenge the carrier’s opinion or stick up for their rights. Is that fair?
Policyholders have a right to free access to the courts and a right to a trial by jury. The proposed legislation throws these rights out the window. It is time that our elected Legislators remember who they are supposed to represent and who they are supposed to protect.