Most of the panic around a storm and a pending closing comes from three separate systems reacting at once. Insurance carriers stop writing new policies the moment a watch or warning is posted. Lenders will not fund without proof of insurance, and after a storm they will not fund without a fresh look at the house. And the Florida contract has its own clock, with a force majeure clause that extends deadlines and a risk-of-loss clause that decides who pays for damage. Understanding each one separately is the difference between a closing that slides a week and a deal that falls apart. This article covers the closing mechanics; for the insurance inspections themselves, see our guide to the 4-point and wind mitigation inspections.
- The moment the National Hurricane Center posts a tropical storm or hurricane watch or warning for any part of Florida, most carriers suspend binding new homeowners policies. A buyer without a bound policy cannot close a financed purchase until the restriction lifts.
- The FAR/BAR contract's force majeure clause extends deadlines, including the closing date, for a reasonable time up to seven days after the event stops preventing performance. If it drags on more than 30 days past the closing date, either side can cancel and the deposit is refunded.
- The risk-of-loss clause puts storm damage before closing on the seller up to 1.5% of the price; above that, the buyer chooses between taking the property with that credit or walking away with the deposit.
- After a FEMA disaster declaration, lenders require a post-storm inspection before funding, even on a home that took no damage.
- Bind the homeowners policy the day the contract is signed, not the week of closing. It is the single step that keeps a closing on schedule through a storm.
What a watch does to insurance binding
Florida property insurers, including Citizens, operate under binding restrictions tied to the National Hurricane Center. When a tropical storm or hurricane watch or warning is issued for any part of the state, carriers suspend the issuance of new policies and increases in coverage until the watch or warning is lifted and, for many carriers, for a period after landfall while they assess claims. A policy that was bound before the restriction stays in force; a policy that was quoted but not bound cannot be issued until the restriction ends.
For a financed purchase this is the choke point. The lender will not fund without a paid or bound homeowners policy, and often a flood policy as well. A buyer who planned to "take care of insurance the week of closing" and hits a watch on Tuesday has a closing that cannot fund on Friday, through nobody's fault. The fix is entirely in the timing: bind coverage as soon as the inspection contingency clears, with an effective date of the closing, and get the binder to the lender and to us. If the closing moves, the effective date moves with it; if a storm comes, the coverage is already in place.
Flood insurance has its own wrinkle. A new NFIP policy normally carries a 30-day waiting period, which is waived when the policy is bought in connection with a loan closing, but the waiver only helps if the application and premium are in before the closing date. Private flood carriers set their own rules and many follow the same binding suspensions as homeowners carriers.
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What the contract says: force majeure and risk of loss
The Florida Realtors/Florida Bar contract handles storms in two standards, and buyers and sellers routinely confuse them.
Force majeure. Neither party is in default if performance, or the availability of services, insurance or approvals essential to closing, is prevented or delayed by a hurricane or other event beyond their control. Time periods, including the closing date, are extended for a reasonable period up to seven days after the force majeure no longer prevents performance. If the event continues to prevent performance for more than 30 days beyond the closing date, either party may terminate by written notice and the buyer's deposit is refunded. In practice: a storm that closes the courthouse for three days pushes your closing a week, not a month, and a storm that leaves a home uninsurable for six weeks lets either side walk.
Risk of loss. If the property is damaged by casualty after the effective date and before closing, and the cost of restoration does not exceed 1.5% of the purchase price, the seller is responsible for the repair and the closing proceeds; if the repairs are not finished by closing, the estimated cost is escrowed from the seller's proceeds. If the cost exceeds 1.5%, the buyer chooses: take the property as it is with the 1.5% credit, or terminate and take the deposit back. On a $500,000 sale the line is $7,500, which is roughly a section of screen enclosure or a few shingles, so most real storm damage crosses it and puts the decision in the buyer's hands.
Two things the contract does not do. It does not extend a lender's rate lock, which is a separate agreement with the lender and may cost money to extend. And it does not change who owns the house: the seller owns it, and bears the loss, until the deed is delivered at closing, which is why the seller's insurance must stay in force through the closing date and not be cancelled the morning of.
What the lender does after a storm
When FEMA declares a disaster area, or a lender's own policy is triggered by a named storm, the lender will not fund a loan in the affected counties until the property is re-inspected. Fannie Mae and Freddie Mac guidelines require the lender to confirm the property was not damaged, and most lenders order a disaster inspection (a short exterior or interior report from the appraiser or an inspector) before releasing funds. On a home that took no damage, that is a few days and a small fee. On a home with a blue tarp, the loan does not fund until the repairs are made and re-inspected, which puts you back in the risk-of-loss clause above.
Appraisals dated before the storm are treated as stale for this purpose. Expect a "post-disaster certification" line item, expect the closing disclosure to be reissued if the closing date moves, and remember that a reissued disclosure restarts the three-business-day waiting period before you can sign.
Cash buyers are not bound by any of this, which is why cash deals close in the week after a storm while financed deals wait. If you are a cash buyer, the only outside party you need is your title agent, and we can close by remote online notarization from wherever you evacuated to.
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Closing when offices, courts and banks are closed
A closing is a set of physical events, and a storm interrupts several of them at once. Clerks of court close, so deeds cannot be recorded; banks close or move to reduced hours, so wires are delayed; power and internet go down, so signings and payoff confirmations stall. Here is how each is handled on our files:
- Signing. Florida permits remote online notarization, so a buyer or seller who has evacuated can sign from a hotel in Georgia on a video call. We schedule RON signings as the default on any file with a closing date inside a storm's forecast window.
- Recording. We e-record in nearly every county. When the clerk's system is down, the signed documents are held in escrow and recorded the morning it reopens. Under the Florida contract, closing is complete when the documents are signed and funds are disbursed; the title policy's gap coverage protects the buyer for the period between closing and recording.
- Funds. Wires initiated before a bank's cutoff on the last business day before a closure land the same day. We tell buyers to send closing funds two business days ahead during a watch, and we hold funds in escrow until every condition is met, so early money is never at risk.
- Payoffs. A seller's mortgage payoff is quoted through a date and accrues per diem interest after it. If a storm pushes closing past the good-through date, we order an updated figure; the seller's per-diem for those days comes out of the seller's proceeds, which is one more reason to close before the storm rather than after it.
The wire-fraud risk goes up during a storm, not down. Criminals watch for closings that have been rescheduled and send "updated instructions." Our instructions never change, and any request to send funds somewhere new should be confirmed by calling our office at (561) 396-2692 before a dollar moves.
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Submit a Contract →The pre-storm checklist for buyers, sellers and agents
Buyers: bind homeowners and flood coverage the day the inspection contingency clears; send closing funds two business days early if a watch is posted; ask the lender in writing whether a post-storm inspection will be required and how long it takes; ask us to set up a RON signing as a backup.
Sellers: keep your homeowners policy in force through the recording date; photograph the property inside and out the day before a storm arrives, dated, so any damage claim is easy to document; know the 1.5% figure on your contract price; if you have evacuated, tell us where you are and we will arrange a remote signing.
Agents: calendar the force majeure math for every open file (closing date plus seven, closing date plus thirty); get the insurance binder into the file before you get the appraisal; if damage occurs, get a licensed contractor's written estimate fast, because the 1.5% test turns on it and the buyer's election is on the clock.
What we do on every file in the cone: confirm the insurance binder is in hand, move the signing to RON, order updated payoffs, ask the lender about post-storm requirements, and keep everyone on one email thread so the closing date changes once, with everyone's agreement, rather than three times. A storm delays closings. It does not have to kill them.
Related Reading
The 4-Point and Wind Mitigation Inspections
Why insurance holds up Florida closings and how to line it up early.
5 Reasons Florida Closings Get Delayed
Payoffs, spousal signatures, estoppels, surveys and wire timing.
Florida's Flood Disclosure Law for Sellers
What sellers must disclose about flooding and flood insurance.
Frequently Asked Questions
Can you close on a house during a hurricane warning in Florida?
A cash closing can, by remote online notarization, as long as funds can move. A financed closing usually cannot, because carriers suspend binding new homeowners policies while a watch or warning is in effect and the lender will not fund without coverage. A policy bound before the watch is unaffected.
Does the Florida contract let a buyer cancel because of a hurricane?
Not because of the storm itself. Force majeure extends deadlines up to seven days after the event stops preventing performance, and only if it continues more than 30 days past the closing date may either party cancel. Damage is handled separately under the risk-of-loss standard: above 1.5% of the price, the buyer may take the property with that credit or terminate.
Who pays for hurricane damage that happens before closing?
The seller, up to 1.5% of the purchase price, with the closing proceeding and any unfinished repair cost escrowed. Above 1.5%, the buyer elects to take the property with the 1.5% credit or to terminate and receive the deposit back.
Will my lender require another inspection after a storm?
If the property is in a FEMA-declared disaster area, or the lender's own policy is triggered by a named storm, yes. The lender orders a post-disaster inspection before funding, even on an undamaged home. It usually takes a few days and a small fee.
What should I do about insurance if I am under contract in September?
Bind the homeowners policy, and flood if required, as soon as the inspection period ends, with an effective date of the closing. If the closing moves, the effective date moves. If a watch is posted, coverage is already in place and the closing can fund.