When storms threaten, insurance companies won't write new home insurance policies or increase home insurance coverage. Without insurance, mortgage companies won't give loans. Without loans, most house deals don't close. So, especially during hurricane season, most mortgage experts advise that homebuyers secure insurance well before closing day.
Insurers differ as to when they place a freeze on new homeowner's policies.
State Farm Insurance Co. and Allstate Insurance Co. stop writing policies when a hurricane watch or warning is posted in the county where the property is located. They tend to start writing policies again 48 hours after the storm leaves. At one point this week, two storms, Danielle and Earl, were in the box at the same time. Alan Cook of the Windstorm Underwriting Association said the rule was made to keep homeowners from buying insurance only when storms threaten, then canceling it when they are gone. There is a way to lessen the chances that your closing will be delayed because of storm threats.