Homeowners Insurance in Texas
Texas homeowners insurance includes protection against fire, wind, theft, vandalism, and more. You may need separate coverage for hurricanes and earthquakes.
Written by Bellina Gaskey
Reviewed by Melanie Reiff
Homeowners insurance in Texas is typically more expensive than the national average because the state faces high risks from environmental factors and natural disasters.
A standard homeowners policy will cover damage due to fire, theft, vandalism, and more.
Purchasing a home is one of the most important financial decisions of your life—and there are many reasons your home could turn into a financial sinkhole, from burglaries to severe storms or even liability cases. That’s why it’s crucial to have a protective home insurance plan.
Make sure to read over your policy carefully so you know what will and won’t be covered before signing on the dotted line. Here to walk you through what you need to know about Texas homeowners insurance is licensed
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and home insurance
broker Jerry
.What is homeowners insurance?
Homeowners insurance (or simply “home insurance”) provides financial protection for your house and the property therein in case of damages or total loss.
The average cost of homeowners insurance in the US is $1,387 per year, which comes out to around $115 per month.
Basic components of homeowners insurance
There are five types of coverage in your standard homeowners policy:
- Coverage A (Structure): Covers repair and replacement costs for your house itself
- Coverage B (Additional structures): Covers repair or replacement costs for additional property, like a detached garage or fence, not part of the house itself
- Coverage C (Personal property): Covers repair or replacement costs for personal belongings including furniture, electronics, jewelry, and clothing
- Coverage D (Additional expenses): If your home becomes uninhabitable after an incident, this coverage will pay for alternative living arrangements like a hotel. Also called “loss of use” coverage
- Coverage E (Personal liability): If someone is injured at your home, this pays for any legal fees and obligatory payments you need to cover (up to your liability limit)
You’ll have to choose between an actual cash value (ACV) policy and a replacement cost policy when it comes to how you receive payouts.
Actual cash value will give you the amount your items are worth at the time of the damage or loss (subject to depreciation), while replacement cost entitles you to the money you would need to purchase a comparable new item. The latter option is, unsurprisingly, more expensive.
Keep in mind that many insurance companies will require you to purchase a policy that pays for at least 80% of the replacement cost of your items.
MORE: Home insurance terms you need to know
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Named perils
What each homeowners policy will cover depends on the company and your location, but every policy formats what situations they will cover as a list of named perils. Named perils often include the following:
- Fire
- Lightning
- Accidental release of water or smoke
- Damage caused by vehicles or aircraft
- Theft
- Vandalism, mischief
- Riots, civil commotion
- Falling objects
- Explosions
In Texas, wind, hail, and hurricanes may be covered—but only if you do not live on the Gulf Coast, where these risks are substantially higher.
Key Takeaway Any situation not listed as a named peril won’t be covered, so make sure you read your policy carefully to know exactly when you have protection.
Is homeowners insurance required in Texas?
Texas state law does not mandate home insurance. However, banks and other mortgage lenders will require you to have a policy for at least the duration of your loan.
That said, it’s very risky to go without home insurance, even if it’s not required for you. Forego home insurance, and you’ll be stuck paying for damages including the total loss of your home out of pocket.
How to get homeowners insurance
The best way to find the right home insurance policy is to shop for quotes from various insurance providers. This doesn’t have to be overwhelming or time-consuming, either—just use
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to review dozens of competitive quotes from top providers in a few minutes.You won’t want to just accept the first insurance plan you come across, as you won’t know whether you’re being overcharged for your coverage.
Another tip is to make sure you get a quote from your
car insurance
provider, too. This quote may not be the lowest one you get, but you could actually get the most savings in the long run by bundling your home and auto policies together. Bundling discounts range from 5% to 15% or more, so don’t miss this great opportunity!
Recommended home insurance coverage in Texas
Texas homes face high risks of damage from multiple sources, some of which aren’t covered by homeowners insurance. Some of the biggest threats to houses in the Lone Star State include:
- Hurricanes and other tropical storms
- Flooding
- Termites
- Earthquakes
Infestations by termites, rats, or any other pest are never covered by home insurance, since this damage is considered preventable.
To protect yourself from earthquakes, you’ll need to purchase separate
earthquake insurance
, such as that provided by the California Earthquake Authority. Hurricanes and flooding are a little more complicated. You’re likely to have hurricane coverage if you don’t live near the Gulf Coast in general. If you do, you’ll need to take out a separate hurricane insurance policy or otherwise get more wind and water damage coverage.
When it comes to flooding, most home insurance policies include burst pipes or accidental water discharges (like that from appliances) on their list of named perils, but flooding from external sources (like a bad rainstorm) won’t be covered.
To get comprehensive protection against flooding, you can:
- Opt for a National Flood Insurance Program (NFIP) policy or similar referral
- Opt for supplemental sump pump or water backup coverage
- Purchase an HO-5 or open perils policy, which covers all incidents except those named as exclusions
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What affects home insurance prices in Texas?
You can expect your Texas homeowners policy to cost more than the national average of $1,387 per year. Estimates place the average cost of a policy in Texas between $1,400 and $3,000.
On an individual level, your personal circumstances do influence the rates you have to pay, such as marital status, credit score, and history of claims filed.
From there, certain statewide factors can cause the price of Texas home insurance to increase:
Wind damage
Many events, from rainstorms to hurricanes and tornadoes, can cause massive amounts of wind damage to Texas homes.
Since this is such a common claim and it can be very expensive for insurance companies, all homeowners are likely to pay higher premiums to compensate for expected insurer losses.
Flooding
Beyond the obvious water damage from hurricanes and tropical storms, flooding is very common in Texas. Claims adjusters estimate that around 20% of flooding happens outside of high-risk flood zones in Texas, which means any home is theoretically at risk.
Texas infrastructure is built mainly with hot temperatures in mind, so when the occasional cold snap hits the state, burst pipes and frozen infrastructure can cause costly damage.
Homeowners insurance discounts in Texas
It can be disheartening to learn you’re paying more than most people for your home insurance, but many insurance companies try to make paying for premiums less burdensome by offering plenty of insurance discounts.
Here’s a list of discounts common with providers in Texas:
Discount | How to get it |
|---|---|
Bundling | Bundling home and auto insurance could earn you a steep discount on both policies. |
First-time homeowner | Most companies will offer you a discounted policy if it’s your first time purchasing a home. |
Claims-free | If you maintain a certain period (typically a few years) without any claims on your policy, you may be eligible for a discounted rate. |
Storm proofing | Installing various hurricane safety measures, such as an upgraded roof or storm shutters, could earn you a discount on your homeowners policy. |
Security system | If you’ve got a security system to prevent theft, your insurance company might discount your homeowners insurance rate. |
Upgraded fire alarm | Set up your fire alarm to contact the fire department directly—your insurance company may give you a discount for a shorter fire response time. |
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What is the average cost of homeowners insurance in Texas?
Texas homeowners insurance will cost anywhere from approximately $1,400 per year to over $3,000 per year, depending on your house’s size, value, location, and your financial history.
Is homeowners insurance required in Texas?
No, homeowners insurance is not required in Texas. It’s still highly recommended that every homeowner purchase a policy to avoid having to pay extensive out of pocket costs after a major loss or incident.
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