Did you know that as a named tropical storm or hurricane approaches Florida most insurance companies will suspend writing homeowner policies until the storm has passed? Often the suspension remains in place for a couple of days after as well. The storm doesn’t have to be headed directly toward the area of your new home and there are no regulations governing how long before or after the storm insurers can suspend issuing policies. How does that affect you? If you are financing your new home your lender requires that you have homeowner insurance before closing. If your insurer can’t issue your policy because of a storm “on the grid,” your lender can’t release the mortgage funds and you won’t be able to close on your new house as planned.
It’s hard to believe that a storm predicted to make landfall far away, even on the gulf coast or south Florida, can affect your ability to close on a home in northeast Florida but it can and does. The good news? This is easily avoidable simply by purchasing your insurance policy in advance of your closing date.
Angela King, a local Allstate Insurance agent/owner has helped many of my customers with their insurance needs. She offers these tips about buying homeowners insurance for your new home:
- Get quotes early in the process and plan to finalize your insurance about 30 days prior to your closing date.
- Review coverages thoroughly. Make sure you understand what is covered and what is excluded on the policy.
- Review the deductibles and make sure you are prepared for the out of pocket expense if a claim should occur. Typically, once you secure a policy you are unable to make a change to your hurricane deductible in the middle of a policy period. 2% is a standard hurricane deductible. Some companies will allow you to drop that to $1000 or $500 for a higher premium.
- If you have a screened enclosure be sure to add coverage for hurricane on the enclosure. It is not always included automatically.
- Flood coverage is not included on the standard homeowner policy and there’s a 30-day waiting period if you don’t purchase it at the time of closing. If a storm is approaching and you don't have it in place you can buy a policy, but it won't cover you for 30 days from the effective date. If you plan or are required to purchase flood insurance for your new home be sure to secure coverage at the time of closing.
With all the tasks that need to be done when purchasing a new home this one may be easy to overlook. Don’t! Be sure to put it near the top of your To-Do list so your closing won’t be delayed.
Angela King is a licensed insurance agent and has owned an Allstate Insurance agency in St. Johns, FL since 2011. She and her team are widely known in the area for not only their top-notch customer service and exceptional product knowledge, but also for their involvement in and contributions to the local community. If you have questions about insurance or would like a quote you can reach Angela at (904) 217-8430.
Julie Bentley has been a licensed Realtor in northeast Florida since 2012 and has advised hundreds of customers to bind their homeowner’s insurance policy well in advance of closing on their new home. When a home she has listed goes under contract during hurricane season, she checks with the buyer’s agent a few weeks ahead of closing to see if the policy has been issued. Some may call that overkill; she calls it prudent. Julie can be reached at 904-576-0706.