Real Estate, Homeowners & Hurricane Season

Real Estate

Are you closing a property late Summer? when a hurricane is on its way to the Florida coast Real Estate closings may suffer delays. Insurance companies can hold all mortgage transactions once the National Weather Service issues a hurricane warning or watches. 

Homeowner Insurance is as important as a pre-approval?
All lenders require a Homeowner’s insurance to close unless it is an all-cash deal.

When buying a property all sellers request a pre-approved mortgage in order to have more security that the transaction gets a loan approval at the time of closing. 

However, Homeowner insurance is as most important as a pre-approval requisite especially in South Florida with Hurricane season every year. it is also important to find out if the property is in a flooding area as the policy coverage and deductibles vary. In barrier island areas such as Key Biscayne, the potential damages are much higher therefore high insurance rate is inevitable.

Some Insurances do accept the binding method. Which means that as long as the premium quoted is paid prior to the National Oceanic and Atmospheric Administration (NOAA) issues a hurricane/storm warning or watch the insurance will pay the damages caused by a hurricane. Not having the premium paid could change the total quote offered by the insurance which could also add further delay or even closing to fail. 

To close a Real Estate transaction in South Florida having a local insurance agent is important they know exactly how to proceed in order to avoid major delays. Closing can be delayed if insurance is not properly issued on time, as all contract in the State of Florida has a Force Majeure clause meaning.  All contracts in the State of Florida include a force majeure clause meaning that a 

After a storm, a seller needs to submit a re-inspection and fix any damages caused by the storm. The buyer and/or seller can activate the force majeure clause to extend the closing 30 days and provide both the buyer or seller the time to update all the requirements or after 30 days the closing could take actions or fail to meet the new criteria by either the Mortgage Banker or the Insurance Co.


It is important to seriously keep informed all customers and track all transactions during hurricane season in order to avoid complications or delays.