Alabama 2024 Regular Session

Alabama Senate Bill SB326 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	SB326INTRODUCED
2	2	Page 0
3	3	SB326
4	4	CN9HWQJ-1
5	5	By Senator Melson
6	6	RFD: Agriculture, Conservation, and Forestry
7	7	First Read: 16-Apr-24
8	8	1
9	9	2
10	10	3
11	11	4
12	12	5 CN9HWQJ-1 04/16/2024 SLU (L)bm 2024-687
13	13	Page 1
14	14	First Read: 16-Apr-24
15	15	SYNOPSIS:
16	16	Under existing law, Alabama homeowners insurance
17	17	providers are not prohibited from offering coverage for
18	18	sinkhole loss but are not required to do so. A
19	19	"sinkhole" is the collapse of ground cover most often
20	20	caused when certain types of underground bedrock is
21	21	dissolved by underground water.
22	22	This bill would require all homeowners insurance
23	23	providers authorized to write homeowners policies in
24	24	the state to cover catastrophic ground cover collapse
25	25	in all homeowners insurance policies and to offer
26	26	coverage for sinkhole loss at the policyholder's option
27	27	for an additional premium, subject to certain
28	28	restrictions and deductibles imposed by the insurance
29	29	provider.
30	30	This bill would establish a procedure for
31	31	investigating a claim for sinkhole loss coverage in
32	32	order to determine the cause and extent of damage to
33	33	the property.
34	34	This bill would provide the rights and
35	35	obligations of the insurance provider, the homeowner,
36	36	and the professional service providers engaged in the
37	37	investigation process related to providing notices,
38	38	filing reports, and paying claims based on the
39	39	investigative conclusions.
40	40	1
41	41	2
42	42	3
43	43	4
44	44	5
45	45	6
46	46	7
47	47	8
48	48	9
49	49	10
50	50	11
51	51	12
52	52	13
53	53	14
54	54	15
55	55	16
56	56	17
57	57	18
58	58	19
59	59	20
60	60	21
61	61	22
62	62	23
63	63	24
64	64	25
65	65	26
66	66	27
67	67	28 SB326 INTRODUCED
68	68	Page 2
69	69	investigative conclusions.
70	70	A BILL
71	71	TO BE ENTITLED
72	72	AN ACT
73	73	Relating to sinkhole loss insurance coverage; to
74	74	require that all homeowners insurance policies cover loss
75	75	caused by catastrophic ground cover collapse and to offer
76	76	optional coverage for loss due to sinkhole damage; to
77	77	establish the procedure for investigating a claim for damage;
78	78	and to provide certain rights and obligations of the parties
79	79	to a claim based on the outcome of the investigation.
80	80	BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
81	81	Section 1. For purposes of this act, the following
82	82	terms have the following meanings:
83	83	(1) CATASTROPHIC GROUND COVER COLLAPSE. Geological
84	84	activity that results in all of the following:
85	85	a. The abrupt collapse of the ground cover.
86	86	b. A depression in the ground cover clearly visible to
87	87	the naked eye.
88	88	c. Structural damage to the covered building, including
89	89	the foundation.
90	90	d. The insured structure being condemned and ordered to
91	91	be vacated by the governmental agency authorized by law to
92	92	issue such an order for that structure. Contents coverage
93	93	applies if there is a loss resulting from a catastrophic
94	94	ground cover collapse. Damage consisting merely of the
95	95	29
96	96	30
97	97	31
98	98	32
99	99	33
100	100	34
101	101	35
102	102	36
103	103	37
104	104	38
105	105	39
106	106	40
107	107	41
108	108	42
109	109	43
110	110	44
111	111	45
112	112	46
113	113	47
114	114	48
115	115	49
116	116	50
117	117	51
118	118	52
119	119	53
120	120	54
121	121	55
122	122	56 SB326 INTRODUCED
123	123	Page 3
124	124	ground cover collapse. Damage consisting merely of the
125	125	settling or cracking of a foundation, structure, or building
126	126	does not constitute a loss resulting from a catastrophic
127	127	ground cover collapse.
128	128	(2) COVERED BUILDING. A building covered by homeowners
129	129	insurance that includes coverage for loss resulting from
130	130	sinkholes or from catastrophic ground cover collapse.
131	131	(3) LICENSED PROFESSIONAL GEOLOGIST. The same meaning
132	132	as defined in Section 34-41-3, Code of Alabama 1975. A
133	133	licensed professional geologist must also have experience and
134	134	expertise in the identification of sinkhole activity as well
135	135	as other potential geologic causes of structural damage.
136	136	(4) PERSONAL LINES RESIDENTIAL PROPERTY INSURANCE.
137	137	Includes condominium insurance, dwelling fire policies that
138	138	provide dwelling or contents coverage, renters or tenants
139	139	insurance, and mobile home or manufactured home insurance. The
140	140	term excludes creditor placed property insurance and
141	141	condominium association or homeowner association property
142	142	insurance.
143	143	(5) PRIMARY STRUCTURAL MEMBER. A structural element
144	144	designed to provide support and stability for the vertical or
145	145	lateral loads of the overall structure.
146	146	(6) PRIMARY STRUCTURAL SYSTEM. An assemblage of primary
147	147	structural members.
148	148	(7) PROFESSIONAL ENGINEER. The same meaning as defined
149	149	in Section 34-11-1, Code of Alabama 1975. A professional
150	150	engineer must also have experience and expertise in the
151	151	identification of sinkhole activity or other potential causes
152	152	of structural damage.
153	153	57
154	154	58
155	155	59
156	156	60
157	157	61
158	158	62
159	159	63
160	160	64
161	161	65
162	162	66
163	163	67
164	164	68
165	165	69
166	166	70
167	167	71
168	168	72
169	169	73
170	170	74
171	171	75
172	172	76
173	173	77
174	174	78
175	175	79
176	176	80
177	177	81
178	178	82
179	179	83
180	180	84 SB326 INTRODUCED
181	181	Page 4
182	182	of structural damage.
183	183	(8) SINKHOLE. A landform created by subsidence of soil,
184	184	sediment, or rock as underlying strata are dissolved by
185	185	groundwater and formed by collapse into subterranean voids
186	186	created by dissolution of limestone or dolostone or by
187	187	subsidence as these strata are dissolved.
188	188	(9) SINKHOLE ACTIVITY. Settlement or systematic
189	189	weakening of the earth supporting a covered building only if
190	190	the settlement or systematic weakening results from
191	191	contemporaneous movement or raveling of soils, sediments, or
192	192	rock materials into subterranean voids created by the effect
193	193	of water on a limestone or a similar rock formation.
194	194	(10) SINKHOLE LOSS. Structural damage to a covered
195	195	building, including the foundation, caused by sinkhole
196	196	activity, as well as damage to or loss of contents of a
197	197	covered building and additional living expenses.
198	198	(11) STRUCTURAL DAMAGE. A covered building, regardless
199	199	of the date of its construction, which has experienced the
200	200	following:
201	201	a. Interior floor displacement or deflection in excess
202	202	of acceptable variances as defined by applicable local
203	203	ordinance, which results in settlement-related damage to the
204	204	interior such that the interior building structure or members
205	205	become unfit for service or represents a safety hazard as
206	206	defined by applicable local ordinance.
207	207	b. Foundation displacement or deflection in excess of
208	208	acceptable variances as defined by applicable local ordinance,
209	209	which results in settlement-related damage to the primary
210	210	structural members or primary structural systems that prevents
211	211	85
212	212	86
213	213	87
214	214	88
215	215	89
216	216	90
217	217	91
218	218	92
219	219	93
220	220	94
221	221	95
222	222	96
223	223	97
224	224	98
225	225	99
226	226	100
227	227	101
228	228	102
229	229	103
230	230	104
231	231	105
232	232	106
233	233	107
234	234	108
235	235	109
236	236	110
237	237	111
238	238	112 SB326 INTRODUCED
239	239	Page 5
240	240	structural members or primary structural systems that prevents
241	241	those members or systems from supporting the loads and forces
242	242	they were designed to support to the extent that stresses in
243	243	those primary structural members or primary structural systems
244	244	exceed one and one-third of the nominal strength allowed under
245	245	the applicable local ordinance pertaining to new residential
246	246	buildings of similar structure, purpose, or location.
247	247	c. Damage that results in listing, leaning, or buckling
248	248	of the exterior load-bearing walls or other vertical primary
249	249	structural members to such an extent that a plumb line passing
250	250	through the center of gravity does not fall inside the middle
251	251	one-third of the base as defined by applicable local
252	252	ordinance.
253	253	d. Damage that results in the building, or any portion
254	254	of the building containing primary structural members or
255	255	primary structural systems, being significantly likely to
256	256	imminently collapse because of the movement or instability of
257	257	the ground within the influence zone of the supporting ground
258	258	within the sheer plane necessary for the purpose of supporting
259	259	the building as defined by applicable local ordinance.
260	260	e. Damage occurring on or after October 1, 2024, that
261	261	qualifies as substantial structural damage as defined by
262	262	applicable local ordinance.
263	263	Section 2. (a)(1) Every insurer authorized under a
264	264	certificate of authority for property insurance and writing
265	265	homeowners and other personal lines residential property
266	266	insurance policies in the State of Alabama must provide
267	267	coverage for a catastrophic ground cover collapse in every
268	268	homeowners insurance policy.
269	269	113
270	270	114
271	271	115
272	272	116
273	273	117
274	274	118
275	275	119
276	276	120
277	277	121
278	278	122
279	279	123
280	280	124
281	281	125
282	282	126
283	283	127
284	284	128
285	285	129
286	286	130
287	287	131
288	288	132
289	289	133
290	290	134
291	291	135
292	292	136
293	293	137
294	294	138
295	295	139
296	296	140 SB326 INTRODUCED
297	297	Page 6
298	298	homeowners insurance policy.
299	299	(2) The insurer may limit catastrophic ground cover
300	300	collapse to the principal building, as defined in the
301	301	applicable policy.
302	302	(b)(1) The insurer shall make available, for an
303	303	appropriate additional premium, coverage for sinkhole losses
304	304	on any structure, including the contents of personal property
305	305	contained therein, to the extent provided in the form to which
306	306	the coverage attaches.
307	307	(2) The insurer may restrict sinkhole loss coverage to
308	308	the principal building as defined in the applicable policy and
309	309	require an inspection of the property before issuance of
310	310	sinkhole loss coverage.
311	311	(3) A policy for residential property insurance may
312	312	include a deductible amount applicable to sinkhole losses
313	313	equal to one percent, two percent, five percent, or 10 percent
314	314	of the policy dwelling limits, with appropriate premium
315	315	discounts offered with each deductible amount.
316	316	(4) An insurer offering a policy that excludes coverage
317	317	for sinkhole losses must inform policyholders in bold type of
318	318	not less than 14 points as follows: "YOUR POLICY PROVIDES
319	319	COVERAGE FOR A CATASTROPHIC GROUND COVER COLLAPSE THAT RESULTS
320	320	IN THE PROPERTY BEING CONDEMNED AND UNINHABITABLE. OTHERWISE,
321	321	YOUR POLICY DOES NOT PROVIDE COVERAGE FOR SINKHOLE LOSSES. YOU
322	322	MAY PURCHASE ADDITIONAL COVERAGE FOR SINKHOLE LOSSES FOR AN
323	323	ADDITIONAL PREMIUM."
324	324	(5) An insurer offering sinkhole coverage to
325	325	policyholders before or after the adoption of this act may
326	326	nonrenew the policies of policyholders maintaining sinkhole
327	327	141
328	328	142
329	329	143
330	330	144
331	331	145
332	332	146
333	333	147
334	334	148
335	335	149
336	336	150
337	337	151
338	338	152
339	339	153
340	340	154
341	341	155
342	342	156
343	343	157
344	344	158
345	345	159
346	346	160
347	347	161
348	348	162
349	349	163
350	350	164
351	351	165
352	352	166
353	353	167
354	354	168 SB326 INTRODUCED
355	355	Page 7
356	356	nonrenew the policies of policyholders maintaining sinkhole
357	357	coverage at the option of the insurer, and provide an offer of
358	358	coverage that includes catastrophic ground cover collapse and
359	359	excludes sinkhole coverage. Insurers acting in accordance with
360	360	this subdivision must satisfy all of the following
361	361	requirements:
362	362	a. Notify policyholders that a nonrenewal is for
363	363	purposes of removing sinkhole coverage, and that the
364	364	policyholder is being offered a policy that provides coverage
365	365	for catastrophic ground cover collapse.
366	366	b. Provide policyholders with an actuarially reasonable
367	367	premium credit or discount for the removal of sinkhole
368	368	coverage and provision of only catastrophic ground cover
369	369	collapse.
370	370	c. Subject to the provisions of this subsection and the
371	371	insurer's approved underwriting or insurability guidelines,
372	372	provide each policyholder with the opportunity to purchase an
373	373	endorsement to his or her policy providing sinkhole coverage
374	374	and may require an inspection of the property before issuance
375	375	of a sinkhole coverage endorsement.
376	376	(c) Any claim, including, but not limited to, initial,
377	377	supplemental, and reopened claims under an insurance policy
378	378	that provides sinkhole coverage is barred unless the insurer
379	379	was given notice of the claim in accordance with the terms of
380	380	the policy within two years after the policyholder knew or
381	381	reasonably should have known about the sinkhole loss.
382	382	Section 3. (a) Upon receipt of a claim for a sinkhole
383	383	loss to a covered building, an insurer must satisfy each of
384	384	the following requirements in investigating a claim:
385	385	169
386	386	170
387	387	171
388	388	172
389	389	173
390	390	174
391	391	175
392	392	176
393	393	177
394	394	178
395	395	179
396	396	180
397	397	181
398	398	182
399	399	183
400	400	184
401	401	185
402	402	186
403	403	187
404	404	188
405	405	189
406	406	190
407	407	191
408	408	192
409	409	193
410	410	194
411	411	195
412	412	196 SB326 INTRODUCED
413	413	Page 8
414	414	the following requirements in investigating a claim:
415	415	(1) Inspect the policyholder's premises to determine if
416	416	there is structural damage that may be the result of sinkhole
417	417	activity.
418	418	(2) If the insurer confirms that structural damage
419	419	exists but is unable to identify a valid cause of such damage
420	420	or discovers that the damage is consistent with sinkhole loss,
421	421	the insurer shall engage a professional engineer or a
422	422	professional geologist to conduct testing as provided in
423	423	Section 4 to determine the cause of the loss within a
424	424	reasonable professional probability and issue a report as
425	425	provided in Section 5 only if sinkhole loss is covered under
426	426	the policy. Except as provided in paragraph (b)(1)c. and
427	427	subsection (d), the fees and costs of the professional
428	428	engineer or professional geologist shall be paid by the
429	429	insurer.
430	430	(3) Following the initial inspection of the
431	431	policyholder's premises, the insurer shall provide written
432	432	notice to the policyholder disclosing all of the following
433	433	information:
434	434	a. What the insurer has determined to be the cause of
435	435	damage, if the insurer has made such a determination.
436	436	b. A statement of the circumstances under which the
437	437	insurer is required to engage a professional engineer or a
438	438	professional geologist to verify or eliminate sinkhole loss
439	439	and to engage a professional engineer to make recommendations
440	440	regarding land and building stabilization and foundation
441	441	repair.
442	442	c. A statement regarding the right of the policyholder
443	443	197
444	444	198
445	445	199
446	446	200
447	447	201
448	448	202
449	449	203
450	450	204
451	451	205
452	452	206
453	453	207
454	454	208
455	455	209
456	456	210
457	457	211
458	458	212
459	459	213
460	460	214
461	461	215
462	462	216
463	463	217
464	464	218
465	465	219
466	466	220
467	467	221
468	468	222
469	469	223
470	470	224 SB326 INTRODUCED
471	471	Page 9
472	472	c. A statement regarding the right of the policyholder
473	473	to request testing by a professional engineer or a
474	474	professional geologist, the circumstances under which the
475	475	policyholder may demand certain testing, and the circumstances
476	476	under which the policyholder may incur costs associated with
477	477	testing.
478	478	(b)(1) If the insurer determines that there is no
479	479	sinkhole loss, the insurer may deny the claim.
480	480	a. If coverage for sinkhole loss is available and the
481	481	insurer denies the claim without performing testing under
482	482	Section 4, the policyholder may demand testing by the insurer
483	483	under Section 4.
484	484	b. The policyholder's demand for testing must be
485	485	communicated to the insurer in writing within 60 days after
486	486	the policyholder's receipt of the insurer's denial of the
487	487	claim.
488	488	c. The policyholder shall pay 50 percent of the actual
489	489	costs of the analyses and services provided under Sections 4
490	490	and 5 or two thousand five hundred dollars ($2,500), whichever
491	491	is less.
492	492	d. The insurer shall reimburse the policyholder for the
493	493	costs if the insurer's engineer or geologist provides written
494	494	certification pursuant to Section 5 that there is sinkhole
495	495	loss.
496	496	(2)a. If a sinkhole loss is verified, the insurer shall
497	497	pay to stabilize the land and covered building and repair the
498	498	foundation in accordance with the recommendations of the
499	499	professional engineer engaged pursuant to subdivision (a)(2),
500	500	with notice to the policyholder, subject to the coverage and
501	501	225
502	502	226
503	503	227
504	504	228
505	505	229
506	506	230
507	507	231
508	508	232
509	509	233
510	510	234
511	511	235
512	512	236
513	513	237
514	514	238
515	515	239
516	516	240
517	517	241
518	518	242
519	519	243
520	520	244
521	521	245
522	522	246
523	523	247
524	524	248
525	525	249
526	526	250
527	527	251
528	528	252 SB326 INTRODUCED
529	529	Page 10
530	530	with notice to the policyholder, subject to the coverage and
531	531	terms of the policy. The insurer shall pay for other repairs
532	532	to the structure and contents in accordance with the terms of
533	533	the policy. If a covered building suffers a sinkhole loss or a
534	534	catastrophic ground cover collapse, the policyholder must
535	535	repair such damage or loss in accordance with the insurer's
536	536	professional engineer's recommended repairs. However, if the
537	537	insurer's professional engineer determines that the repair
538	538	cannot be completed within policy limits, the insurer must pay
539	539	to complete the repairs recommended by the insurer's
540	540	professional engineer or tender the policy limits to the
541	541	policyholder.
542	542	b. The insurer may limit its total claims payment to
543	543	the actual cash value of the sinkhole loss, which does not
544	544	include underpinning or grouting or any other repair technique
545	545	performed below the existing foundation of the building, until
546	546	the policyholder enters into a contract for the performance of
547	547	building stabilization or foundation repairs in accordance
548	548	with the recommendations set forth in the insurer's report
549	549	issued pursuant to Section 5.
550	550	c. In order to prevent additional damage to the
551	551	building or structure, the policyholder must enter into a
552	552	contract for the performance of building stabilization and
553	553	foundation repairs within 90 days after the insurance company
554	554	confirms coverage for the sinkhole loss and notifies the
555	555	policyholder of such confirmation.
556	556	d. After the policyholder enters into the contract for
557	557	the performance of building stabilization and foundation
558	558	repairs, the insurer shall pay the amounts necessary to begin
559	559	253
560	560	254
561	561	255
562	562	256
563	563	257
564	564	258
565	565	259
566	566	260
567	567	261
568	568	262
569	569	263
570	570	264
571	571	265
572	572	266
573	573	267
574	574	268
575	575	269
576	576	270
577	577	271
578	578	272
579	579	273
580	580	274
581	581	275
582	582	276
583	583	277
584	584	278
585	585	279
586	586	280 SB326 INTRODUCED
587	587	Page 11
588	588	repairs, the insurer shall pay the amounts necessary to begin
589	589	and perform such repairs as the work is performed and the
590	590	expenses are incurred. The insurer may not require the
591	591	policyholder to advance payment for such repairs. If repair
592	592	covered by a personal lines residential property insurance
593	593	policy has begun and the professional engineer selected or
594	594	approved by the insurer determines that the repair cannot be
595	595	completed within the policy limits, the insurer must complete
596	596	the professional engineer's recommended repair or tender the
597	597	policy limits to the policyholder without a reduction for the
598	598	repair expenses incurred.
599	599	e. The stabilization and all other repairs to the
600	600	structure and contents must be completed within 12 months
601	601	after entering into the contract for repairs described in
602	602	paragraph d. unless any of the following occur:
603	603	1. There is a mutual agreement between the insurer and
604	604	the policyholder.
605	605	2. The claim is in litigation.
606	606	3. The claim is under appraisal or mediation.
607	607	f. Upon the insurer's obtaining the written approval of
608	608	any lienholder, the insurer may make payment directly to the
609	609	persons selected by the policyholder to perform the land and
610	610	building stabilization and foundation repairs. The decision by
611	611	the insurer to make payment to such persons does not hold the
612	612	insurer liable for the work performed.
613	613	(c) The policyholder may not accept a rebate from any
614	614	person performing the repairs specified in this section. If a
615	615	policyholder receives a rebate, coverage is void and the
616	616	policyholder must refund the amount of the rebate to the
617	617	281
618	618	282
619	619	283
620	620	284
621	621	285
622	622	286
623	623	287
624	624	288
625	625	289
626	626	290
627	627	291
628	628	292
629	629	293
630	630	294
631	631	295
632	632	296
633	633	297
634	634	298
635	635	299
636	636	300
637	637	301
638	638	302
639	639	303
640	640	304
641	641	305
642	642	306
643	643	307
644	644	308 SB326 INTRODUCED
645	645	Page 12
646	646	policyholder must refund the amount of the rebate to the
647	647	insurer. Any person performing the repairs specified in this
648	648	section who offers a rebate commits a Class D felony. As used
649	649	in this subsection, the term "rebate" means a remuneration,
650	650	payment, gift, discount, or transfer of any item of value to
651	651	the policyholder by or on behalf of a person performing the
652	652	repairs specified in this section as an incentive or
653	653	inducement to obtain repairs performed by that person.
654	654	(d) If the insurer obtains written certification
655	655	pursuant to Section 5 that there is no sinkhole loss or that
656	656	the cause of the damage was not sinkhole activity, and if the
657	657	policyholder has submitted the sinkhole claim without good
658	658	faith grounds for submitting the claim, the policyholder shall
659	659	reimburse the insurer for 50 percent of the actual costs of
660	660	the analyses and services provided under Sections 4 and 5;
661	661	however, a policyholder is not required to reimburse an
662	662	insurer more than two thousand five hundred dollars ($2,500)
663	663	with respect to any claim. A policyholder is required to pay
664	664	reimbursement under this subsection only if the policyholder
665	665	requested the analyses and services pursuant to Sections 4 and
666	666	5, and the insurer, before ordering the analyses pursuant to
667	667	Section 4, informs the policyholder in writing of the
668	668	policyholder's potential liability for reimbursement and gives
669	669	the policyholder the opportunity to withdraw the claim.
670	670	(e) An insurer may not nonrenew any policy of property
671	671	insurance on the basis of filing of claims for sinkhole loss
672	672	if the total of such payments does not equal or exceed the
673	673	policy limits of coverage for the policy in effect on the date
674	674	of loss, for property damage to the covered building as set
675	675	309
676	676	310
677	677	311
678	678	312
679	679	313
680	680	314
681	681	315
682	682	316
683	683	317
684	684	318
685	685	319
686	686	320
687	687	321
688	688	322
689	689	323
690	690	324
691	691	325
692	692	326
693	693	327
694	694	328
695	695	329
696	696	330
697	697	331
698	698	332
699	699	333
700	700	334
701	701	335
702	702	336 SB326 INTRODUCED
703	703	Page 13
704	704	of loss, for property damage to the covered building as set
705	705	forth on the declarations page, or if the policyholder
706	706	repaired the structure in accordance with the engineering
707	707	recommendations made pursuant to subdivision (a)(2) upon which
708	708	any payment or policy proceeds were based. If the insurer pays
709	709	such limits, the insurer may nonrenew the policy.
710	710	(f) The insurer may engage a professional structural
711	711	engineer to make recommendations as to the repair of a
712	712	structure.
713	713	Section 4. A professional engineer and professional
714	714	geologist shall perform such tests as sufficient, in their
715	715	professional opinion, to determine the presence or absence of
716	716	sinkhole loss or other cause of damage within reasonable
717	717	professional probability and for the professional engineer to
718	718	make recommendations regarding necessary building
719	719	stabilization and foundation repair.
720	720	Section 5. (a)(1) Upon completion of testing pursuant
721	721	to Section 4, the professional engineer or professional
722	722	geologist shall issue a report and certification to the
723	723	insurer and the policyholder as provided in this section.
724	724	(2) Sinkhole loss is verified if, based upon tests
725	725	performed pursuant to Section 4, a professional engineer or a
726	726	professional geologist issues a written report and
727	727	certification providing answers to all of the following:
728	728	a. That structural damage to the covered building has
729	729	been identified within a reasonable professional probability.
730	730	b. That the cause of the structural damage is sinkhole
731	731	activity within a reasonable professional probability.
732	732	c. That the analyses conducted were of sufficient scope
733	733	337
734	734	338
735	735	339
736	736	340
737	737	341
738	738	342
739	739	343
740	740	344
741	741	345
742	742	346
743	743	347
744	744	348
745	745	349
746	746	350
747	747	351
748	748	352
749	749	353
750	750	354
751	751	355
752	752	356
753	753	357
754	754	358
755	755	359
756	756	360
757	757	361
758	758	362
759	759	363
760	760	364 SB326 INTRODUCED
761	761	Page 14
762	762	c. That the analyses conducted were of sufficient scope
763	763	to identify sinkhole activity as the cause of damage within a
764	764	reasonable professional probability.
765	765	d. A description of the tests performed.
766	766	e. A recommendation by the professional engineer of
767	767	methods for stabilizing the land and building and for making
768	768	repairs to the foundation.
769	769	(3) If there is no structural damage or if sinkhole
770	770	activity is eliminated as the cause of such damage to the
771	771	covered building, the professional engineer or professional
772	772	geologist shall issue a written report and certification to
773	773	the policyholder and the insurer stating any of the following:
774	774	a. That there is no structural damage or the cause of
775	775	such damage is not sinkhole activity within a reasonable
776	776	professional probability.
777	777	b. That the analyses and tests conducted were of
778	778	sufficient scope to eliminate sinkhole activity as the cause
779	779	of the structural damage within a reasonable professional
780	780	probability.
781	781	c. The cause of the structural damage within a
782	782	reasonable professional probability.
783	783	d. A description of the tests performed.
784	784	(4) The respective findings, opinions, and
785	785	recommendations of the insurer's professional engineer or
786	786	professional geologist as to the cause of damage to the
787	787	property and the findings, opinions, and recommendations of
788	788	the insurer's professional engineer as to land and building
789	789	stabilization and foundation repair set forth in this section
790	790	shall be presumed correct.
791	791	365
792	792	366
793	793	367
794	794	368
795	795	369
796	796	370
797	797	371
798	798	372
799	799	373
800	800	374
801	801	375
802	802	376
803	803	377
804	804	378
805	805	379
806	806	380
807	807	381
808	808	382
809	809	383
810	810	384
811	811	385
812	812	386
813	813	387
814	814	388
815	815	389
816	816	390
817	817	391
818	818	392 SB326 INTRODUCED
819	819	Page 15
820	820	shall be presumed correct.
821	821	(b)(1) An insurer that has paid a claim for a sinkhole
822	822	loss shall file a copy of the report and certification,
823	823	prepared pursuant to subsection (a), including the legal
824	824	description of the real property and the name of the property
825	825	owner, which indicates that sinkhole activity caused the
826	826	damage claimed, a copy of the certification indicating that
827	827	stabilization has been completed, if applicable, and the
828	828	amount of the payment, with the county clerk of court, who
829	829	shall record the report and certification. The insurer shall
830	830	bear the cost of filing and recording one or more reports and
831	831	certifications. There shall be no cause of action or liability
832	832	against an insurer for compliance with this section.
833	833	(2) The recording of the report and certification does
834	834	not constitute or create any of the following:
835	835	a. A lien, encumbrance, or restriction on the title to
836	836	the real property or constitute a defect in the title to the
837	837	real property.
838	838	b. Any cause of action or liability against any grantor
839	839	of the real property for breach of any warranty of good title
840	840	or warranty against encumbrances.
841	841	c. Any cause of action or liability against any title
842	842	insurer that insures the title to the real property.
843	843	(3) As a precondition to accepting payment for a
844	844	sinkhole loss, the policyholder must file with the judge of
845	845	probate for the county where the property is located, a copy
846	846	of any sinkhole report regarding the insured property which
847	847	was prepared on behalf or at the request of the policyholder.
848	848	The policyholder shall bear the cost of filing and recording
849	849	393
850	850	394
851	851	395
852	852	396
853	853	397
854	854	398
855	855	399
856	856	400
857	857	401
858	858	402
859	859	403
860	860	404
861	861	405
862	862	406
863	863	407
864	864	408
865	865	409
866	866	410
867	867	411
868	868	412
869	869	413
870	870	414
871	871	415
872	872	416
873	873	417
874	874	418
875	875	419
876	876	420 SB326 INTRODUCED
877	877	Page 16
878	878	The policyholder shall bear the cost of filing and recording
879	879	the sinkhole report. The recording of the report does not
880	880	constitute or create any of the following:
881	881	a. A lien, encumbrance, or restriction on the title to
882	882	the real property or constitute a defect in the title to the
883	883	real property.
884	884	b. Any cause of action or liability against any grantor
885	885	of the real property for breach of any warranty of good title
886	886	or warranty against encumbrances.
887	887	c. Any cause of action or liability against a title
888	888	insurer that insures the title to the real property.
889	889	(c)(1) Upon completion of any building stabilization or
890	890	foundation repairs for a verified sinkhole loss, the
891	891	professional engineer responsible for monitoring the repairs
892	892	shall issue a report to the property owner which specifies
893	893	what repairs have been performed and certifies within a
894	894	reasonable degree of professional probability that such
895	895	repairs have been properly performed.
896	896	(2) The professional engineer issuing the report shall
897	897	file a copy of the report and certification, which includes a
898	898	legal description of the real property and the name of the
899	899	property owner, with the judge of probate for the county where
900	900	the property is located, who shall record the report and
901	901	certification. This subsection does not create liability for
902	902	an insurer based on any representation or certification by a
903	903	professional engineer related to the stabilization or
904	904	foundation repairs for the verified sinkhole loss.
905	905	(d) The seller of real property upon which a sinkhole
906	906	claim has been made by the seller and paid by the insurer must
907	907	421
908	908	422
909	909	423
910	910	424
911	911	425
912	912	426
913	913	427
914	914	428
915	915	429
916	916	430
917	917	431
918	918	432
919	919	433
920	920	434
921	921	435
922	922	436
923	923	437
924	924	438
925	925	439
926	926	440
927	927	441
928	928	442
929	929	443
930	930	444
931	931	445
932	932	446
933	933	447
934	934	448 SB326 INTRODUCED
935	935	Page 17
936	936	claim has been made by the seller and paid by the insurer must
937	937	disclose to the buyer of such property, before the closing,
938	938	that a claim has been paid and whether or not the full amount
939	939	of the proceeds was used to repair the sinkhole damage.
940	940	Section 6. This act shall become effective on October
941	941	1, 2024.
942	942	449
943	943	450
944	944	451
945	945	452
946	946	453