A semiconductor device has a semiconductor die with a sensor and a cavity formed into a first surface of the semiconductor die to provide access to the sensor. A protective layer is formed on the first surface of the semiconductor die around the cavity. An encapsulant is deposited around the semiconductor die. The protective layer blocks the encapsulant from entering the cavity. With the cavity clear of encapsulant, liquid or gas has unobstructed entry into cavity during operation of the semiconductor die. The clear entry for the cavity provides reliable sensor detection and measurement. The semiconductor die is disposed over a leadframe. The semiconductor die has a sensor. The protective layer can be a film. The protective layer can have a beveled surface. A surface of the leadframe can be exposed from the encapsulant. A second surface of the semiconductor die can be exposed from the encapsulant.