"We are sorry that we cannot continue this insurnace therefore your policy will not be renewed...Material increase in hazard as evidenced by the fact that the residence is not owner occupied as required by our policy".

The location is great on this property (2 miles to the Island / 5 mile to Dollywood), no HOA and sq ft ~ 335 (2bd / 2.5 ba) but getting very nervous as will be first deal and would love some input here or mentor input as continue down the path of investing and learning. 

Flat fee, percentage, maximum amount, how many months can the late fee continue to be applied, etc.Thanks in advance!

As you continue to live there, new things will come up. 

Still learning a lot as we continue to grow and improve. 

Also to answer your question, I would not back out of the deal because of this or some other minor issue that can be easily fixed, it seems like you have all the financials thought and planned out, continue with it if possible and don't lose it because of that. 

Don't continually harass them with phone calls or emails.

Continue your positive thinking and you will find the right deal, get it financed, and then suffer all the fear, anxiety, and sleepless nights we have all gone through LOL.  

If you're planning to move around often, I would probably say continue renting while investing in Huntsville (assuming you really understand the dynamics market).

By taking the equity from one property and reinvesting it into another, you can continue building your real estate empire without constantly injecting fresh capital.Why BRRR Works for Real Estate InvestorsThe BRRR strategy allows investors to grow their portfolios faster because it leverages the property’s equity to fund future deals.