If Hurricane Earl flirts with the Florida coast, many property insurers will stop writing new policies. That, in turn, impacts homebuyers who need insurance to finalize their mortgage. Without insurance, they can’t get mortgage money; and without mortgage money, they can’t close.
Insurers have in-house rules about issuing new policies. For example, Florida’s property insurer, Citizens Property Insurance, stops writing policies in a wide area if a hurricane threatens. Some insurers rely on the National Weather Service to issue a storm watch or warning. If that happens, they stop writing policies in the potentially impacted areas.
In all cases, a homebuyer heading to closing while a hurricane threatens should contact his or her property insurance carrier to determine that company’s rules.
