Texas Home Insurance

• Cost of Home Insurance in Texas
• What Texas Home Insurance Covers
• Wind and Hail Insurance Requirements in Texas
• Texas Home Insurance Discounts

Texas Homeowners Insurance

Whether you live near the coast in Galveston or Houston or you’ve planted roots in Austin or Dallas, one thing is certain: owning a home in Texas is the dream for many folks.

But certain exposures make homeowners insurance in Texas unlike other states. The state is prone to hurricanes in the Gulf Coast, tornadoes inland, and hailstorms everywhere. These weather events help make Texas among the most costly states for insurers to cover.

So let’s take a look at Texas homeowners insurance, from the cost of coverage and what a standard policy covers to additional coverages and insurance regulations.

Cost of Texas Home Insurance

The average cost of homeowners insurance in Texas is $1,955, according to data from the Insurance Information Institute.

That said, there are many factors that impact your premium, including:

• Where your home is located.
• Your home’s construction.
• The coverage amounts you choose.
• The deductible you choose.
• Your insurance score and your claims history.

The coverage you choose plays an important role in how much your policy will be. With that in mind, let’s look at what a standard home policy covers and additional coverages that make sense for Texas’s climate.

What Does Texas Home Insurance Cover?

Texas homeowners insurance policies include the following types of coverage:

• Dwelling (Coverage A): Covers damage to the home from fire, theft, and vandalism.
• Personal property (Coverage B): Covers replacement costs for personal belongings that are lost or damaged because of fire, theft, or vandalism.
• Other structures (Coverage C): Covers damage to structures on your property that aren’t attached to your home, such as garages, fences, and sheds.
• Loss of use (Coverage D): Covers living expenses when your home is uninhabitable after a covered incident.
• Personal liability (Coverage E): Covers legal expenses if you’re sued over a visitor’s injuries or damaged property.
• Medical payments (Coverage F): Covers medical expenses when someone is hurt on your property.
• Wind / hail coverage: Covers wind and hail damage to the home and personal property. This has a separate deductible of 1%, 2%, 3%, 4%, 5%, or 10% of your dwelling coverage limit. We’ll look at this coverage in more detail shortly.

Pro tip: Look for policies that offer replacement cost insurance for your home, other structures, and belongings. This offers the appropriate payout to repair your home and replace your things with new items of a similar quality.

What Texas Homeowners Insurance Doesn’t Cover

Standard homeowners insurance policies don’t cover:

• Flooding or earthquakes
• Mold, except to cover damage due to a covered water-related event
• Pests, such as insects, mice, rats, or termites
• Wind or hail damage to shrubs and trees

If you live in an area susceptible to flooding, strongly consider carrying flood insurance.

Finding Flood Insurance for Homes in Coastal Texas

Standard home insurance doesn’t cover flood damage from storms and hurricanes – only a flood insurance policy can cover that. If you’re in Galveston or Houston, you know firsthand how important this coverage is.

Hurricane Harvey rampaged across Texas and caused $180 billion in damages. Yet according to a Washington Post analysis, only 17 percent of homeowners in areas most affected by Harvey had flood insurance.

“Only 17 percent of homeowners in areas most affected by Harvey had flood insurance.”

Those without flood insurance had to rely on charity or government aid, or pay out-of-pocket to cover costs. FEMA grants, a common form of government aid, are capped at $33,300, which hardly covers the costs of massive home repairs and replacement costs. Even one inch of standing water costs $23,635 in damages to an average one-story home, according to FEMA.

Hurricane Harvey was a cold reminder of the importance of having flood insurance in Texas. Policies typically cover the following flood damage to:

• Appliances.
• Detached garages.
• Essential home systems, including central air conditioning, electric, and plumbing.
• Foundation walls.
• Personal property.
• Permanently installed cabinets and paneling.
• Valuable items.

Be aware that flood insurance typically doesn’t cover property located in basements or crawl spaces. Homeowners should also be aware of coverage limits (National Flood Insurance Program policy limits are capped at $250,000 per building and $100,000 for contents). Deductibles range from $1,000 to $10,000.

Understanding Texas Flood Zones

Flood insurance premiums are based on the flood risk of the home’s location. Insurers use your home’s flood zone to help determine your risk.

Lastly, be aware that just because your home isn’t in a traditional flood zone doesn’t mean it’s free of flood risk. Most of the 204,000 homes Hurricane Harvey affected were outside the federally regulated 100-year floodplain.

Windstorm and Hail Insurance in Texas

While most mortgage lenders require homeowners to purchase windstorm and hail insurance, the state of Texas doesn’t. Other coastal states have universal insurance regulations in place, but Texas allows counties to create their own regulations. That lack of consistency can be confusing for Texas homeowners.

Windstorm and hail insurance can be purchased through private insurance companies. The Texas Windstorm Insurance Association (TWIA) is another option, but often considered an insurer of last resort for homes located in designated catastrophe areas. These include Texas’s 14 coastal counties and parts of Harris Country located east of Highway 146: Aransas, Brazoria, Calhoun, Cameron, Chambers, Galveston, Jefferson, Kennedy, Kleberg, Matagorda, Nueces, Refugio, San Patricio and Willacy.

Keep in mind that when a hurricane enters the Gulf of Mexico, you can’t change or buy windstorm coverage. That’s why it’s important to get covered now before you need it.

Does Your Home Need a Certificate of Compliance to Get Wind Coverage?

A Certificate of Compliance guarantees the home or its structures adhere to windstorm code set by TDI. This certificate is not legally required, but it can help reduce windstorm coverage premiums and make the property eligible for TWIA windstorm coverage. It can also be a major selling point if the property is up for sale at a later date.

Homeowners can obtain a Certificate of Compliance by:

1. Contacting TDI for inspections on ongoing construction.
2. Contacting TWIA for inspections on completed construction.

Texas Homeowners Insurance Discounts

To reduce Texas home insurance costs, you may be eligible for discounts for:

• Installing hurricane glass, accordion shutters, and wind resistant doors.
• Installing smoke detectors and a sprinkler system.
• Using a water consumption monitor to detect abnormalities in water usage.
• Having a home security system.

Finding a Texas Home Insurance Provider You Can Trust

Finding the right home insurance provider doesn’t have to be complicated. Just look for a provider that:

• Has a strong financial stability rating.
• Offers good discounts.
• Provide fast, online quotes and coverage.
• Has glowing customer reviews.

We’re not in Texas yet, but stay tuned! We’re headed your way soon.