There's no two hour insurance product in the ordinary sense, but the exposure is real and there are a few ways people handle it.
The usual approach is a standard vacant dwelling or builder's risk policy bound effective on the date of the first closing. Most carriers write these with a minimum term, often three months or a year, with a short rate or pro rata cancellation. So you pay for a chunk of a policy you use for an afternoon, and you get part of it back when you cancel. On a modest house that might be a couple hundred dollars net. Some carriers won't cancel back below an earned minimum premium, so ask before you bind.
A second piece is the title side. Your owner's policy on the A leg protects you against defects in title during your ownership, and that's a separate thing from physical damage. Both matter. Neither one covers the other.
The part your local group is skipping: your risk isn't only the two hours you plan on. It's the two hours plus whatever happens if the second closing doesn't fund. If the C buyer's wire fails and the resale slips a week, you're an uninsured owner of a vacant house for a week, financed with short term money. That's the scenario the policy is for, and it's exactly the scenario where the cost of it looks obvious in hindsight.
When risk of loss actually passes to you can also depend on how your state and your purchase contract handle it, so read the contract and ask a professional in your state if you're unsure.
