Insurance urged for 'sinking' buildings
Lawmakers to discuss problems created by abandoned mines
24 September 2007, 12:00 a.m.
Topeka The legacy of mining in Kansas has produced the potential hazard for some buildings collapsing into the abandoned mines.
That has led some to call for the availability of mine subsidence insurance.
A legislative committee this fall will review the availability and affordability of mine subsidence coverage for Kansas consumers and businesses.
"We would love to see some form of subsidence insurance happen just because that is an uninsurable risk in the state of Kansas," said Dale Oglesby, who is mayor of the southeast Kansas town of Galena.
The issue is important in Galena, a town of about 3,000. Recently, the two-story Green Parrot bar collapsed, and several other downtown buildings sit upon abandoned lead and zinc mines. The Green Parrot is being demolished.
Without subsidence insurance, some people are unable to get financing for their homes or businesses, Oglesby said.
And, he said, the problem is not just in southeast Kansas.
Parts of Johnson and Wyandotte counties and the Hutchinson area also are affected by undermining.
Lawmakers took a stab at the issue during the last legislative session earlier this year, but decided to study it further.
Under bills leftover from the session, the state would set up a system to allow for mine subsidence coverage under homeowners and basic property insurance. A fund would be set up from premiums paid by policyholders that would go toward paying off claims.
"It would be similar to federal flood insurance," said state Rep. Doug Gatewood, D-Columbus. "We found that there are no insurance carriers in Kansas that will write any subsidence policies based on old coal mining in southeast Kansas and throughout the state."
But Bob Tomlinson, assistant state insurance commissioner, said the problem is that there would probably not be enough policyholders to fund the pool from which claims would be paid. Premiums would be unaffordable, he said.
Tomlinson said the insurance department has searched for companies from out of state that would be willing to write policies in Kansas. He said the department has found one and has already notified independent agents about it.
"That's what we will report to the committee," he said.
Gatewood said he hoped the state would take some action. "I look forward to talking about the issue and seeing what we can do to help the people in Galena," he said.