Homeowner's Insurance can be difficult

Storms keep insurance at bay. The Bradenton Hearld reported the case of one such homeowner.
In the summer of 2004, during one of the most active hurricane seasons for Florida, Joanne Johansen was buying a new house.

The process of buying a home can be stressful, but that process was made worse, Johansen said, by hurricanes Charley, Frances, Ivan and Jeanne.
In order to complete the home-buying process, a one-year insurance policy must be written before a mortgage can be closed, said Johansen, owner of Platinum Mortgage Solutions in Bradenton.

Unfortunately, insurance companies may not write policies when hurricanes threaten.
"The person buying my house was trying to get insurance, I was trying to get insurance, and the person whose house I was buying was trying to get insurance for his new house," Johansen said. "It was a little crazy."

During the season, some insurance companies stop writing new policies, and renewing old ones, as soon as a hurricane enters what is called "The Box."
"The Box" runs along latitude and longitude lines from North Carolina to Jamaica, and Jamaica to the Yucatan Peninsula, encompassing all of Florida and most of the Gulf of Mexico, said Ken Hughes, manager of Hughes Insurance Services Inc., located on 26th Street West in Bradenton.

The window of opportunity to get insurance between hurricanes could be as narrow as a few days. In 2004, Johansen said there was about a six-week period when a hurricane was in "The Box" almost constantly.

"We all basically had to wait for that window and jump on it," Johansen said. "We closed and moved into the house on Friday, and Jeanne came in that Sunday."
When no hurricanes are looming, insurance agents try to bind as many policies as possible. Binding a policy provides homeowners with a legal document saying the insurance company will insure their homes beginning on a certain date, Hughes said.

In order to bind a policy, agents at Hughes Insurance need an appraisal and other information about the house. During hurricane season, however, Hughes said agents understand the need for people to get a policy quickly so they work to expedite the process. They can complete the process in a few days.

"People need to be aware of the storms and their closing dates and get insurance locked up as soon as possible," Hughes said. "They need to get their insurance figured out while the weather is still OK."

Other insurance companies stop writing policies when a hurricane watch or warning has been issued for an area.

State Farm Insurance makes its policy decisions based on forecasts from the National Weather Service, said Chris Neal, public affairs manager for State Farm of Florida.
If a watch or warning is in effect for South Florida, State Farm agents will still write policies for northern counties. If most of the state is under a hurricane advisory, no policies will be written.
Clients hoping to get insurance and buy a house simply have to wait until the advisories are lifted.

State Farm also tries to bind policies quickly in between storms but the process is complicated, Neal said. Agents have to inspect the house and get basic information about it, such as when it was built, any damage it has, the condition of the plumbing and wiring, and for how much the property should be insured.

"When people are looking at buying a new home, they definitely need to line up a policy as quickly as possible," he said. "I would encourage people to call their insurance agent as soon as they have picked out a house."