Even movie stars aren’t immune to a potential insurance headache.
After a massive sinkhole opened up in the driveway of a house in Malibu that belongs to actor Nicolas Cage, the star of Wild at Heart and Moonstruck could find himself in a battle with his insurance provider.
The sinkhole, which was reported to be 25 feet deep and 30 by 60 feet wide, created a local emergency for Malibu residents and resulted in the evacuation of 31 homes.
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“The sinkhole poses imminent danger to the homes and residents along Sea Level Drive,” wrote Malibu’s director of emergency services. “As of the time of this proclamation, seven residences have been red-tagged due to hazardous conditions resulting from the sinkhole and an additional 24 residences will be red-tagged due to the loss of safe vehicular access.”
Right now, those involved are likely focused on keeping everyone safe. But when the dust settles, Cage and potentially a few of his neighbors will have to fix significant structural damage — and likely wrestle with their home insurance providers in the process.
Here’s what local residents should be aware of in the short term, as well as what you should know about home insurance coverage if you find yourself in a similar situation.
How Hurricane Marie could make the sinkhole worse
There’s never a good time for a massive sinkhole to swallow your driveway, but this particular sinkhole popped up at a bad one.
Shortly after it developed, a powerful swell from Hurricane Marie — which is currently hundreds of miles offshore — “dramatically reshaped” several beaches in the Orange County area, FOX 11 reports. Cage’s oceanfront property is in Los Angeles County, which is directly southeast of Orange County. According to the New York Times, experts believe Marie will continue to bring rain and high tides to the area, which could potentially worsen conditions at the site of the sinkhole on Cage’s driveway.
The press release from the director of emergency services also warned that the forecasted El Niño — a type of weather event marked by unusually warm ocean temperatures — may also cause flooding that could worsen the sinkhole.
The city red-tagged seven residences because of damage caused by the sinkhole. It also red-tagged 24 more because the sinkhole made it impossible for emergency vehicles to access the homes, especially if the sinkhole were to expand.
Thankfully, no one was injured during this ordeal.
“It doesn’t appear that anybody was home,” said Rich Prickett, a reporter at KTLA when reporting on Cage’s house. “As a matter of fact, the house looks like it is under some sort of renovation.”
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Why insurance could be tricky for Cage and his neighbors
Hopefully you won’t ever have to deal with a sinkhole of this size around your home. But if you do, it’s important to know what your home insurance covers in situations like this.
Standard home insurance policies don’t automatically cover sinkholes or any other type of “earth movement.” However, if you’re a Florida resident, your home insurance is required to offer “catastrophic ground coverage collapse.” That coverage kicks in if the sinkhole meets all of the following criteria:
- There’s a sudden ground collapse
- The resulting sinkhole is clearly visible with the naked eye
- The sinkhole causes structural damage to your house and foundation
- Some government entity has condemned your home
Cage’s home likely meets at least some of these requirements, but California does not have the same catastrophic ground coverage collapse requirements for home insurance.
If you live in a state that’s prone to sinkholes, it’s a good idea to check and see what your home insurance covers. If your policy doesn’t automatically cover a sinkhole, you might be able to purchase coverage through your insurance provider.
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Kit Pulliam is a DC-based financial journalist with over five years of experience writing, editing and fact-checking financial content.
