Best homeowners insurance in Texas

Everything you need to know about homeowners insurance in The Lone Star State.

Pat Howard 1600

Pat Howard

Published February 12, 2019

Texas is a state that prides itself on its diverse population, its country music, its barbeque, Gregg Popovich, and how everything there is, well, bigger. The Lone Star State also experiences some pretty catastrophic storms and natural disasters, so whether you own a ranch home in Fort Worth or a beach house in Galveston, you should make sure it’s well protected with homeowners insurance.

Your mortgage company will require that you protect your home with at least some level of hazard insurance, but if you’re a homeowner in Texas, you may want to go a step further than just the required coverage limits.

A standard home insurance policy covers a good amount, but certain types of water damage are usually excluded without additional coverage, and flood damage and earthquake damage is typically never covered. Furthermore, insurers in certain counties may exclude wind and hail damage from your policy.

If you live in an area prone to flooding or near a flood zone, check if your insurer offers a flood policy or endorsement. If they don’t, you can get coverage through the National Flood Insurance Program (NFIP). And if wind and hail damage are excluded from your policy, Texas residents can find coverage through the Texas Windstorm Insurance Association (TWIA).

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The best home insurance companies in Texas

Insurance companyA.M. Best ratingMarket sharePremiumPolicy cost
AllstateA+12.44%$1,088,747,000$1,416
FarmersA8.93%$780,762,470$1,319
State FarmA-20.8%$1,837,352,539$3,085
TravelersA++3.72%$325,797,768$2,608
USAAA++8.51%$744,955,538$1,538

Methodology: Market share and premium data courtesy of the Texas Department of Insurance and was updated as recently as 2019. The annual premium for each insurer was based on a 10-year-old Dallas home with a $200,000 insured value and an owner with an average credit score and no claims in the last five years.

The best Texas home insurance companies for:

Coverage and claims: USAA - USAA is an excellent option for active members of the military, veterans, and their family members due to their low rates and perks for military personnel. USAA also has a near perfect A++ rating with A.M. Best, and features the most comprehensive coverage and customer service experience in the Texas market. With USAA, you don’t have to worry about getting screwed over when something bad happens and you need to file a claim. With their robust coverages and speedy, friendly claims, USAA is a step ahead of the competition.

Low rates: Farmers - If you’re looking for affordable rates, then Farmers may be the company for you. Featuring broad “all risk” coverage and replacement cost reimbursements for both your dwelling and personal property, Farmers doesn’t skimp on coverage either.

Digital tools: Travelers - When it comes to coverage for the modern Texas home, there are very few insurers as fit for the task as Travelers. Thanks to a recent partnership with Amazon, Travelers customers get free Amazon Echo Dots and discounts on Echo-integrated smart home devices. In addition to protecting your stuff, Travelers’ smart home device program can also lower your rates by as much as 20%.

Discounts: Allstate - Few Texas insurers offer as many rate-saving opportunities as Allstate to keep your premiums low. You can save as much as 30% if you get your home and auto insurance through Allstate and up to 20% if you’ve never filed a claim. Allstate will also trim your bill if you add certain protective devices to your home, like a central smoke or burglar alarm, or if you disaster-proof your roof, windows, and doors.

New homebuyers: State Farm - If you recently bought a home and don’t know the first thing about insuring your home, State Farm provides the easiest, most hands-off customer experience in the Texas market. State Farm also insures just about everybody, so while most insurers may be hesitant to take on a client with poor to average credit and no prior insurance history, State Farm is there.

How much does home insurance in Texas cost?

Texas is one of the most expensive states to insure your home in the country. The average premium for a home in Texas was $1,937 in 2016, according to the most recent premium data provided by the Insurance Information Institute. If you own a home in Texas, your insurance rates will be impacted by the following:

  • Your insurance score
  • Your home’s size, age, and build
  • Your roof-type
  • Any hurricane-proof cosmetic or structural home features
  • Your proximity to the Gulf coast
  • Your proximity to a FEMA-designated flood zone
  • How much coverage you have, and whether you need additional insurance like a separate flood or windstorm policy

We’ll discuss this in greater detail shortly, but if you live in certain coastal counties in Texas, your insurer may refuse to insure windstorm or hurricane losses and you’ll have to look elsewhere to fill that coverage gap. If you can’t find a windstorm or hurricane policy on the private market, you can get coverage through the Texas Windstorm Insurance Association (TWIA). The downside of TWIA plans is the cost, as rates were about $1,600 on average in 2018.

If you live in high-risk regions of Texas, you’re looking at a potential $4,000 or more premium (your $2,000 standard insurance plus a separate windstorm policy).

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Guide to home insurance in Texas

If you own a home or you’re thinking of buying a home in Texas, you have a lot to take into consideration. You should understand the kind of risks faced by your home and ensure you’re protected against those risks. In most cases, your home insurance policy won’t cover flood or earthquakes, and may not cover wind or hail if you live on the coasts. If you have a gap in coverage, talk to your agent about the next best option, or consult the Texas Department of Insurance.

Is homeowners insurance required in Texas?

Homeowners insurance isn’t required by law in Texas, but if you have a mortgage, your lender will require you to get at least some form of coverage.

Generally, your lender will require a minimum amount of “hazard” insurance, which is another way of saying a homeowners insurance policy. If you live in a flood zone or near the coast, your insurer may also require that you acquire adequate flood and windstorm coverage.

Understanding your standard coverage

Dwelling coverage - Your policies dwelling coverage is your home’s insured value, and will reimburse you if your home is damaged by a covered peril. Most Texas insurers have two types of dwelling deductibles: a dollar-amount deductible for most perils, and a wind and hail deductible for damage caused by any wind or hail damage. Your wind and hail damage is usually anywhere from 1% to 5% of your home’s insured value.

Other structures coverage - Your other structures coverage reimburses you for covered damage to structures not directly attached to your home. Fences, detached garages, sheds, and gazebos are all considered “other structures”. Your other structures coverage may also be subject to a wind and hail deductible.

Personal property coverage - Your personal property coverage is typically 50% of your home’s insured value and covers the contents of your home up to your personal property coverage limit. Your personal property coverage typically only covers “named perils”, and you’re generally only reimbursed the actual cash value of items worth under a standard policy. Additionally, some types of personal property – like jewelry, expensive furs, and art – have sublimits and are typically only covered up to $1,500. Limits can be increased with a scheduled valuables endorsement or rider. Be sure to take an inventory of all of your personal belongings inside the home, value it, and calculate what it would cost to repair or replace your stuff if they’re damaged, destroyed, or stolen by a covered loss.

Loss-of-use coverage - Loss-of-use coverage, or your “additional living expenses”, pays for your living expenses if a covered peril displaces you from your home and makes it uninhabitable. In some cases, your loss-of-use may be needed for a year or longer if your home incurs a total loss and you need to live somewhere else while it’s rebuilt. Loss-of-use is typically 20% of your home’s dwelling coverage, but your insurer may let you increase your coverage limits.

Liability insurance - Liability coverage protects your assets if someone is injured in your home and sues you. It also provides coverage for you if you cause damage to someone else’s personal property. Most liability limits are anywhere from $100,000 to $500,000.

Medical payments coverage - Covers guests’ medical bills if they’re injured in your home. Medical payments coverage is generally anywhere from $1,000 to $5,000.

Additional home insurance for Texas residents

Flood insurance - If you live in an area of Texas that’s a FEMA designated “flood zone”, check with your insurer to see if they offer private flood. If they don’t they may direct you toward the National Flood Insurance Program (NFIP), who can set you up with invaluable flood coverage.

But even if you don’t live in a designated flood zone, you may want to consider flood coverage anyway. Much of the flood damage caused by Hurricane Harvey occurred outside of the 100-year flood plains.

Wind and hail coverage - As we touched on earlier, insurers in most counties in Texas provide coverage for wind and hail damage by charging you wind and hail deductibles. You may also have the option as the insured to decline wind and hail coverage for a discounted premium.

But many insurers in Gulf Coast counties exclude wind and hail coverage and don’t even offer the separate deductible option, which is where the Texas Windstorm Insurance Association (TWIA) comes in. The TWIA offers wind and hail policies in 14 coastal counties and parts of Harris County. In order to qualify for a TWIA policy, applicants must have been rejected by at least one private insurer. Here’s a list of TWIA-eligible counties:

  • Aransas
  • Brazoria
  • Calhoun
  • Cameron
  • Chambers
  • Galveston
  • Jefferson
  • Kenedy
  • Kleberg
  • Matagorda
  • Nueces
  • Refugio
  • San Patricio
  • Willacy

If you need to get a TWIA policy, be sure you get coverage in advance of hurricane season, as it's not uncommon for insurers and surplus line carriers to put a moratorium on coverage after a certain date.

Wildfire insurance - Texas is also no stranger to wildfires, ranking second in wildfire frequency in the United States, according to the Insurance Information Institute. If you live in a wildfire-prone region of Texas, be sure you have enough dwelling coverage, and consider adding extended replacement cost coverage or guaranteed replacement cost coverage.

Earthquake insurance - Earthquakes insurance isn’t the most pressing coverage need for Texas homeowners, but they do occur from time to time, and the damage has the potential to be catastrophic. If you live near a fault line, like the Balcones fault in central Texas, you should consider Earthquake coverage. If you’d like to acquire earthquake coverage and your insurer doesn’t offer it, ask you agent to point you in the direction of a carrier who does. Coverage may be available through smaller surplus-line carriers in your area, and some larger insurers like USAA offer earthquake coverage as an endorsement to your policy.

Helpful resources for Texas homeowners

  • Texas Fair Plan Association - Texas Fair Plans are available to Texas homeowners who aren’t able to find a plan in the private market because of a low insurance score, no prior insurance, or uninsurable risks associated with their home. TFPA plans are typically about twice as expensive as private insurance.
  • Texas Department of Insurance - The Texas Department of Insurance is an excellent educational resource for Texas residents.
  • Play Insure - Created by the Texas Department of Insurance, Play Insure is fun way to learn about home and auto insurance. You choose your home type, your city, and your “guide” (you get to choose between Sophia, Vernon, Marcy, Jacob, Gary, and Isabella) walks you through what each part of your home insurance policy mean and how different factors impact your bill.
  • Help insure - Help Insure is also a Texas Department of Insurance creation and is for home and auto insurance customers specifically. With Help Insure, you can get rates for your specific ZIP code from up to 30 Texas insurers. Help Insure also has helpful links and resources to make you a more informed insurance buyer.

Policygenius’ editorial content is not written by an insurance agent. It’s intended for informational purposes and should not be considered legal or financial advice. Consult a professional to learn what financial products are right for you.