A sinking feeling in Pasco and Hernando

Once again, property owners in sinkhole-prone Pasco and Hernando counties are getting shafted by the governor and Legislature.

A new law taking effect in January gives insurance companies the option of summarily dropping property owners who have standard sinkhole coverage - a major protection that helps people fix their homes when a sinkhole is detected.

Instead, insurance companies will be allowed to offer residents new policies that only provide sinkhole coverage for "catastrophic groundcover collapse," in which homes essentially are destroyed and uninhabitable.

For property owners, it's no consolation that the insurers will be permitted to offer standard coverage as an add-on - at additional cost.

The stench associated with this law is familiar. The law is modeled after a stunt the Legislature pulled on customers of the state-controlled Citizens Property Insurance Corp. in 2007. As with this new law, that provision applied only to property owners in Hernando and Pasco.

These residents have done nothing to deserve such shameful treatment. It is not their fault that many live atop shaky ground, which was often ignored by developers and local officials alike. Homeowners who trusted the permitting system to ensure their homes were built safely now see their investment jeopardized. They should not be punished when they file claims for standard sinkhole damage.

Yet Pasco Sen. Mike Fasano, who, along with the Senate Banking and Insurance Committee, pushed for the change, calls standard sinkhole coverage "bells and whistles." Try telling that to homeowners who don't have the cash to fix cracked doorways, ceilings and exteriors, or buckled floors and separated roofs - common results of sinkholes - but aren't suffering from catastrophic collapses.
Full coverage is essential for these homeowners. Insurance companies should not be allowed to simply strip it away, then offer it back at an inflated price, as if it is a luxury.

To Fasano, it's all about cutting property insurance rates and corralling overzealous lawyers who make their living off sinkhole litigation, some questionable. His goals may be admirable, but Fasano is wrong to allow insurers to slip out of the sinkhole coverage.

Geology doesn't lie; Hernando and Pasco are in an area known as "sinkhole alley." But experts say catastrophic collapse is rare, which is why standard coverage is so important.

Testing for sinkholes and repairing damage even in non-catastrophic cases can cost well over $100,000. How many people have that much cash available?

While it's true that affected property owners will see lower premiums - Fasano says 50 percent or more - policyholders need to carefully evaluate the risk. Some could end up financially devastated, their life's savings gone, without the full coverage they will be tempted to forgo once they see their premiums will be reduced.

Yes, residents should have the option of deciding what coverage they want, and they should reassess their policies every year. But the state shouldn't be in cahoots with insurance companies to strip much-needed coverage from so many people.

This is not a proper way to help keep insurance companies in this part of the state, either. Risk needs to be spread. Sinkholes in Florida are not confined to these two counties.

Gov. Charlie Crist, who signed the legislation in June, and Fasano and his fellow lawmakers should recognize the unfairness of this scheme and repeal it.