Short answer: According to Fla. Stat. 627.706, every Florida property insurer must include catastrophic ground cover collapse coverage in the base policy, but broader sinkhole loss coverage is optional: the insurer only has to make it available for an additional premium. Catastrophic ground cover collapse requires the building to be condemned and ordered vacated, while a sinkhole loss only requires structural damage caused by sinkhole activity.
What does Fla. Stat. 627.706 cover?
Fla. Stat. 627.706 governs how Florida property policies treat sinkholes. It draws a hard line between two very different things: catastrophic ground cover collapse (CGCC), which every insurer must include in the base policy, and a broader "sinkhole loss," which is optional coverage the insurer only has to make available for an additional premium. The section also supplies the statutory definitions (sinkhole, sinkhole activity, sinkhole loss, structural damage, professional engineer, professional geologist, neutral evaluation) that apply across ss. 627.706 through 627.7074.
The framework here reflects the 2011 property-insurance reforms and later cleanup; the section was last amended by ch. 2014-123 (and ch. 2014-86), Laws of Florida. It is distinct from the 2021 to 2023 reforms (SB 76, SB 2D, SB 2A, HB 837), none of which amended this statute.
Is sinkhole coverage automatic in a Florida policy?
Only part of it. CGCC coverage is mandatory: "Every insurer authorized to transact property insurance in this state must provide coverage for a catastrophic ground cover collapse." Broader sinkhole loss coverage is not automatic. The insurer must make it available for an appropriate additional premium, and it may require an inspection of the property before writing it. In plain terms, CGCC is included in every policy; sinkhole loss coverage is an add-on you buy.
If a policy excludes sinkhole coverage, the insurer must warn you in bold type of not less than 14 points that the policy covers CGCC resulting in condemnation or uninhabitability but otherwise does not cover sinkhole losses, which may be purchased for an additional premium. The insurer may also restrict both CGCC and sinkhole loss coverage to the principal building defined in the policy.
What is catastrophic ground cover collapse (CGCC)?
CGCC is deliberately narrow. To qualify, all four of these conditions must be met:
- The abrupt collapse of the ground cover;
- A depression in the ground cover clearly visible to the naked eye;
- Structural damage to the covered building, including the foundation; and
- The insured structure being condemned and ordered to be vacated by the governmental agency authorized to issue such an order.
Because condemnation is required, most real-world sinkhole damage does not meet the CGCC bar. The statute is explicit that damage "consisting merely of the settling or cracking of a foundation, structure, or building does not constitute a loss resulting from a catastrophic ground cover collapse." That is exactly the gap sinkhole loss coverage is meant to fill.
What counts as a "sinkhole loss"?
A "sinkhole loss" means structural damage to the covered building, including the foundation, caused by sinkhole activity. Note what is missing: there is no condemnation requirement. You do not need the county to red-tag your home; you need structural damage caused by sinkhole activity. Contents coverage and additional living expenses apply only if there is structural damage to the covered building caused by sinkhole activity.
What are "sinkhole activity" and "structural damage"?
Both terms are defined precisely, and both matter because carriers deny claims by attacking them.
"Sinkhole activity" means settlement or systematic weakening of the earth supporting the covered building only if it results from contemporaneous movement or raveling of soils, sediments, or rock materials into subterranean voids created by the effect of water on a limestone or similar rock formation. A "sinkhole" itself is a landform created by subsidence of soil, sediment, or rock as underlying strata are dissolved by groundwater.
"Structural damage" is not a layperson's phrase here; it carries a detailed five-part statutory definition tied to engineering standards, including interior floor displacement beyond acceptable variances under ACI 117-90 or the Florida Building Code, foundation displacement beyond acceptable variances under ACI 318-95, and, for damage occurring on or after October 15, 2005, "substantial structural damage" as defined in the Florida Building Code. Whether damage clears these thresholds is decided by a professional engineer (defined by reference to s. 471.005, with a bachelor's degree or higher in engineering) or a professional geologist (defined by reference to s. 492.102, with a bachelor's degree or higher in geology or a related earth science). If the carrier and policyholder disagree, the dispute can go to neutral evaluation, the alternative dispute resolution provided in s. 627.7074.
What are the sinkhole coverage deadlines and deductibles?
| Provision | What 627.706 requires | Detail |
|---|---|---|
| CGCC coverage | Mandatory in every property policy | Required of every insurer authorized in Florida |
| Sinkhole loss coverage | Optional add-on | Insurer must make it available for an additional premium |
| Residential sinkhole deductible | Policyholder chooses | 1%, 2%, 5%, or 10% of policy dwelling limits |
| Claim notice deadline | Report the loss in time | Within 2 years after you knew or reasonably should have known |
| Sinkhole-exclusion notice | Bold-type warning | Not less than 14 points |
The 2-year notice window is the deadline that quietly kills sinkhole claims. It runs from when you knew or reasonably should have known about the sinkhole loss, not from the day a geologist confirms it, so cracking and movement you noticed years earlier can start the clock.
How does Ocean Point handle sinkhole claims?
Sinkhole files are engineering fights, not paperwork exercises, and we treat them that way. Ocean Point is a licensed Florida public-adjusting firm (FL DFS license W829547) with 21 years of claims experience and more than 500 mediations behind us; our primary public adjuster, Eli Goins (license P159790), leads sinkhole matters, and we are members of FAPIA.
Our approach: first, we read the policy to see whether you carry CGCC only or a purchased sinkhole loss endorsement, because that decides what you can even claim. Next, we pin the loss to the statutory definitions, structural damage caused by sinkhole activity, rather than the carrier's preferred "settling and cracking is excluded" framing. We document the file to the engineering standards the statute names, and when the carrier's report disputes causation, we use the neutral evaluation process under s. 627.7074 to put an impartial engineer or geologist in front of the facts. Throughout, we watch the 2-year notice deadline so a procedural miss never sinks a valid claim.
Who this is for, and should you buy sinkhole coverage?
If you own property in a limestone-heavy part of Florida and hold only the base policy, understand that you are covered for catastrophic ground cover collapse, essentially a condemned, ordered-vacated structure, and not for the far more common structural cracking caused by sinkhole activity. That gap is why the statute forces insurers to offer sinkhole loss coverage for an added premium and to warn you in 14-point bold when they exclude it.
If you already have damage: check your policy for a sinkhole endorsement, note when you first observed cracking or movement (the 2-year clock), and get the loss evaluated against the statutory definitions before you accept a denial built on the "mere settling" exclusion.
Bottom line: catastrophic ground cover collapse is included in every Florida policy but rarely triggers; real sinkhole protection is the optional coverage you have to buy, and winning a sinkhole claim turns on the statutory definitions and the 2-year notice deadline, not on how bad the cracks look.