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Could sinkholes sink housing market?
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It seems that sinkhole concerns are on the rise. Below is an article out of Orlando about the impending sinkhole insurance rate hikes.
ORANGE COUNTY, Fla. (WOFL FOX 35) – Recent changes to sinkhole insurance could mean big trouble. Insurance for sinkholes will be on the rise, in some cases as much as 4,000 percent. The recent sinkhole in Leesburg has attracted some attention, but maps show the problem isn’t all that common in Central Florida.
State Representative Scott Randolph says we’re still going to foot the bill. “It’s a shame that Central Florida policy holders are going to get hit for a problem that’s really in the Tampa Bay area, north of Tampa Bay area. So the sinkhole policy increases are really a result of what’s happening over there.”
The maps show the Tampa Bay area has the most sinkholes by leaps and bounds. Randolph worries the housing market will be hit hard as sinkhole insurance rises.
“Not only the people already in the houses, but the people trying to buy houses. People are looking at a market where the private insurers allowing 40 to 50 percent increases, If you continue that on, people are going to say look, I can’t afford to buy.”
Randolph wants better regulation of the insurance industry.
“Any type of action that the State Legislature does that significantly increases insurance rates right now are going to drive us further into recession with the housing market playing such a key role in Florida’s economy.”
How much your rates go up will depend on how many sinkholes can be found in your area.
