Mine Subsidence Insurance: Additional Home Insurance Coverage
If your home was built above an abandoned coal mine, you may want to purchase extra insurance coverage. Neighboring properties that sit close to your home are at risk as well. Separate from a standard home insurance policy, state-subsidized insurance programs allow homeowners to insure against this peril at an added, yet affordable, cost.
Reason to Buy Mine Subsidence Insurance
Mine shafts that haven't been used in years can collapse, causing sinkholes and damage to structures sitting above ground. Your home or other buildings situated on the property can sag or partially or totally collapse. Homeowners often are surprised to learn that damage from sinkholes is not covered by a standard home insurance policy.
In some states, such as Ohio, homeowners who live in high-risk counties where there are a lot of abandoned mines are required to buy mine subsidence insurance. But in other states, including Pennsylvania, buying the insurance is optional.
What It Covers
A mine subsidence insurance policy generally covers:
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Excavation costs
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Foundation repair
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Damage to an attached garage, deck, walkway, or driveway
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Damage to some underground utilities
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Damage to underground pilings, pipes, and drains
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Other related costs, which may include expenses for temporary relocation, increased cost of living, and the cost to secure the insured structure
While even a fence may qualify as a covered appurtenance – another structure on the property permanently affixed to the land and used as part of the insured structure – other building structures, such as an unattached garage or tool shed, may require separate policies.
Cost of the Insurance
The cost for mine subsidence insurance depends on the amount of coverage you buy. In states, like Ohio and Pennsylvania, where many abandoned underground mines exist, homeowners can qualify for low-cost, state-sponsored mine subsidence insurance.
When buying a policy, it's important to buy enough insurance to cover your home's replacement value – how much it will cost to replace it. However, the maximum coverage limit varies by state.
Damage to other structures connected to your home generally is limited to 10 percent of the amount of the coverage you purchase. Your home, as the main building structure must be damaged in order to receive any insurance reimbursement for damage to an appurtenance. Before mine subsidence insurance pays on a loss, you are required to pay a deductible out of pocket when you file a claim.
Policies are renewable each year. In some states – Pennsylvania included – homeowners who are 65 or older are eligible for a discount on the mine subsidence insurance premium they pay for their primary residence. Contact a business, such as the Family Insurance Centers, for more information.
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