By: Abigail R. Hartge
Karst landscape makes delicious bourbon because of its natural filtration system.[i] However, it also creates a risk to private homeowners.[ii] Homeowners are unprotected from sinkholes unless they have purchased insurance specific to catastrophic ground collapse or sinkhole coverage.[iii] But what is Karst? Its etymology originates from the German word der Karst a name given to a limestone region in Slovenia.[iv] Translated into the meaning of “landscape underlain by limestone” or gypsum, which is “eroded by dissolution, producing ridges, towers, and sinkholes.”[v] The Kentucky Geological Survey provides a map identifying regions of high potential for Karst topography—major cities include Bowling Green, Elizabethtown, Fort Knox, Frankfort, Georgetown, Lexington, Louisville, and Somerset.[vi] There are no legal requirements or mandates in Kentucky, that demand insurance companies offer or even standardize sinkhole insurance.[vii] Homeowners who are apprised of sinkhole pervasiveness in Kentucky must opt-in by endorsement, rider, or by purchasing a separate policy for a premium.[viii] Other states with high karst topographies, namely Florida and Tennessee have taken legislative actions implementing insurance requirements. [ix]
Tennessee requires that insurance companies offer sinkhole insurance but does not make it mandatory for homeowners to purchase.[x] Florida requires that insurance companies include sinkhole protection as part of a standard insurance package.[xi] There are two types of sinkhole protection in Florida; sinkhole loss coverage and catastrophic ground collapse coverage.[xii] Sinkhole loss coverage generally occurs when it is man-made and not natural.[xiii] The second type, is “catastrophic ground collapse.” In order to qualify for protection four criteria must be met : (1) “the abrupt collapse of the ground cover, (2) a depression in the ground cover clearly visible to the naked eye, (3) structural damage to the covered building including the foundation and (4) the [insured] structure being condemned and ordered to be vacated by the governmental agency” authorized by law to issue such an order for that particular structure.[xiv] Homeowners insurance is generally based on the value to rebuild the physical structure of a home and not the ground. [xv] Catastrophic ground collapse is the insurance policy that provides a remedy to land damage because of a sinkhole.[xvi] This is the distinguishing factor between sinkhole protection and catastrophic ground collapse.[xvii]
In 2014, the Corvette Museum collapsed, and Kentucky’s legislature proposed two House Bills that replicated Florida’s sinkhole and catastrophic ground collapse laws.[xviii] The same year, House Bill 498 was proposed and it defined sinkhole “a landform created by a sudden settlement or collapse of earth supporting the property if the settlement .... resulted from movement rock materials” and would require insurance companies to offer sinkhole protection[xix] House Bill 576, identical to Florida’s catastrophic ground collapse law, was also proposed around the same time.[xx] The legislature was now providing legal definitions, recognizing that Kentucky has a sinkhole issue, but also proposing that insurance companies provide a remedy.[xxi] Unfortunately, both House Bills did not make it past committee and were unsuccessful.[xxii] Then in 2019, the Louisville Zoo experienced a major catastrophic event when a sinkhole occurred that was nearly the size of “three thousand six hundred and eighty nine full sized olympic swimming pools”.[xxiii] Private homeowners not covered by insurance, will experience the liability of a costly repair for a sinkhole on their property but also for the damage to their home.[xxiv] Sinkholes are highly probable issues, so why leave this unnecessary risk un-remedied? The Kentucky legislature should revisit their House Bills from 2014 and re-introduce those bills. Having mandatory requirements that insurance companies offer sinkhole insurance in a standard package is beneficial to Kentucky and its private homeowners.
[i] Stacy B. Willaims, A Legacy of Strength, Slippery Rock Gazette, http://www.slipperyrockgazette.net/index.cfm//pageId/621 (last visited Oct. 14, 2021) [https://perma.cc/6KMQ-EAZ5].
[ii] Carol Zokaites, Living on Karst, Cave Conservancy of the Va. (June 1997), https://caveconservancyofvirginia.org/karst/ [https://perma.cc/KJ9M-9EEU].
[iii] Jason Metz, Don’t Get Sunk Without Sinkhole Insurance, Forbes Advisor (Aug 17, 2021, 6:00 AM), https://www.forbes.com/advisor/homeowners-insurance/sinkhole-insurance/ [https://perma.cc/247C-5MA6].
[iv] karst, Lexico, https://www.lexico.com/en/definition/karst (last visited Oct. 14, 2021) [https://perma.cc/Q7LC-U53L].
[v] Id.
[vi] Where is Karst Located in Kentucky?, U. Ky. Geological Surv., https://www.uky.edu/KGS/karst/karst_location.php (last visited Oct. 14, 2021) [https://perma.cc/TE2G-8GEW].
[vii] See Katie Brandenburg, State Bill Would Require Insurance Companies to Offer Sinkhole Insurance, Bowling Green Dailey News (Mar. 3, 2014), https://www.bgdailynews.com/news/state-bill-would-require-insurance-companies-to-offer-sinkhole-insurance/article_e947b61d-dfe5-5bd5-9e1b-68ff0cf6f7bd.html [https://perma.cc/WR4K-ELS7].
[viii] What you Need to Know About Sinkholes in Kentucky, Ky. Farm Bureau, https://www.kyfb.com/insurance/lifes-blueprints/what-you-need-to-know-about-sinkholes-in-kentucky/ (last visited Oct. 14, 2021) [https://perma.cc/XSG9-CNDM].
[ix] Baker Donelson, Sunk: What Protection Does the Sinkhole Statute Offer Your Clients?, Baker Donelson (Oct. 31, 2013), https://www.bakerdonelson.com/Sunk-What-Protection-Does-the-Sinkhole-Statute-Offer-Your-Clients-10-31-2013 [https://perma.cc/2S8B-MSVL].; Jimmy Patronis, SINKHOLES and CATASTROPHIC Ground Cover Collapse, Dep’t Fin. Serv., https://www.myfloridacfo.com/division/consumers/understandingcoverage/guides/documents/SinkholesCatastrophicGroundCollapseGuide.pdf (last visited Oct. 12, 2021) [https://perma.cc/4GJG-LLW3].
[x] Donelson, supra note ix.
[xi] Patronis, supra note ix.
[xii] Elizabeth Rivelli, What is sinkhole insurance?, Bankrate (Nov. 19, 2020), https://www.bankrate.com/insurance/homeowners-insurance/sinkhole-insurance/
[https://perma.cc/FTB9-8DEU].
[xiii] Id.
[xiv] Metz, supra note ii.
[xv] Insurance for Your House and Personal Possessions, Ins. Info. Inst., https://www.iii.org/article/insurance-for-your-house-and-personal-possessions (last visited Oct. 14, 2021) [https://perma.cc/22N8-KL2Q].
[xvi] Rivelli, supra note xii.
[xvii] Id.
[xviii] Corvette Cave-In, Nat’l Corvette Museum, https://www.corvettemuseum.org/explore/exhibits/corvette-cave-in-exhibit/ (last visited Oct. 14, 2021) [https://perma.cc/2T7L-UHRA].
[xix] H.R. 498, 2014 Reg. Sess. (Ky. 2014).
[xx] H.R. 576, 2014 Reg. Sess. (Ky. 2014).
[xxi] Id.; Corvette Cave-In, supra note xviii.
[xxii] H.R. 498, supra note xix; H.R. 576, supra note xx.
[xxiii] Billy Kobin, Mega Cavern files lawsuit against Louisville Zoo over massive sinkhole, Courier J., https://www.courier-journal.com/story/news/local/2020/03/07/mega-cavern-files-lawsuit-against-louisville-zoo-over-sinkhole/4989189002 (last updated Mar. 8, 2020, 3:35 PM) [https://perma.cc/6XM8-A99W].
[xxiv] Kay Morgan, Will you Sink if you Don’t Have Sinkhole Coverage, Merlin L. Group (Sep. 26, 2018), https://www.propertyinsurancecoveragelaw.com/2018/09/articles/insurance/will-you-sink-if-you-dont-have-sinkhole-coverage/ [https://perma.cc/J9HG-66TC].