Coverage.com, LLC is a licensed insurance producer (NPN: 19966249). Coverage.com services are only available in states where it is licensed. Coverage.com may not offer insurance coverage in all states or scenarios. All insurance products are governed by the terms in the applicable insurance policy, and all related decisions (such as approval for coverage, premiums, commissions and fees) and policy obligations are the sole responsibility of the underwriting insurer. The information on this site does not modify any insurance policy terms in any way.
Texas flood insurance
The Bankrate promise
At Bankrate, we strive to help you make smarter financial decisions. To help readers understand how insurance affects their finances, we have licensed insurance professionals on staff who have spent a combined 47 years in the auto, home and life insurance industries. While we adhere to strict , this post may contain references to products from our partners. Here's an explanation of . Our content is backed by Coverage.com, LLC, a licensed entity (NPN: 19966249). For more information, please see our .
Situated on the coast, it should be no surprise that much of Texas faces serious flooding risks. For instance, recent flooding in Dalla-Fort Worth caused significant problems in 2022. And South Texas in particular has a long history of severe weather and flooding, with at least 21 instances of heavy rain and flooding since 2001. Texas flood risks are so severe, in fact, that in 2018 FEMA put out a press release stating that most residents of Texas are at some risk of flooding. Given the financial devastation that flooding can cause—and the fact that standard home insurance does not cover it—Bankrate’s insurance editorial team has put together what you need to know as a Texas homeowner to decide if flood insurance is right for you.
Why Texas homeowners need flood insurance
Over the last decade, Texas has seen some of the worst hurricanes in recent history. In 2017, Hurricane Harvey caused roughly $125 billion in damage as it slammed into the Gulf Coast. The storm dropped 50 inches of rainfall in some places and completely flooded one-third of Houston’s land area.
Some research has found that climate change is causing flooding in Texas to become more frequent and more devastating. The Washington Post reports that two individual studies determined that climate change increased the amount of rainfall after Hurricane Harvey by 20-35%.
Data from the Federal Emergency Management Agency (FEMA) shows that the risk of flooding is higher along the Texas coastline, in the southern region and the Dallas area. However, almost every part of Texas is somewhat susceptible to flooding, which means homeowners across the state should consider flood insurance. Knowing your flood risk could help you decide if flood insurance is right for you.
Cost of flood insurance in Texas
According to FEMA, the average flood insurance policy costs $935 per year, which provides information about policies secured through the National Flood Insurance Program (NFIP). However, your premium will depend on the flood risk in your area. Higher-risk areas have a higher risk of flood damage, and residents in those areas tend to pay for more coverage. Additionally, some private insurance companies offer flood insurance. A flood policy from a private insurer will likely cost a different amount than a policy underwritten by the government. And flood insurance isn’t just for homeowners; renters may want to consider flood insurance to gain coverage for their personal belongings.
Not every homeowner pays the same amount for their flood insurance. A variety of factors can impact your premium, like your home’s specific location, the value of your home and the value of your belongings inside the home, should you choose to insure them (you can buy a flood policy with just dwelling coverage). Depending on the state, a homeowner’s credit score and claims history might also affect their flood insurance rate. Not all states allow insurance companies to use your credit-based insurance score when calculating your rate.
When to purchase flood insurance
If you are thinking about getting flood insurance, being proactive is key. Most flood insurance policies have a 30-day waiting period, which means the coverage is not valid for one month after signing the contract, although there are a few exceptions. Additionally, some insurance carriers put a moratorium on purchasing flood insurance policies when a natural disaster is imminent. If you wait until a storm is on the way to buy insurance, you might find yourself unable to purchase a policy.
Insurance experts typically advise that Texas residents not wait until a storm is on the horizon to purchase flood insurance coverage. Storms are unpredictable and can hit at any time. Having a flood policy in place before a storm is coming is the safest way to prepare for the financial impact of flood damage.
How to purchase flood insurance in Texas
Purchasing flood insurance is a bit different from buying regular home insurance. The first thing to do when considering flood insurance is to determine where you can get quotes. There are two main options for getting flood insurance in Texas.
NFIP flood insurance
The most common option is to buy a policy through the National Flood Insurance Program (NFIP). The NFIP is a government-run insurance program that offers flood insurance. NFIP flood insurance can be written with dwelling coverage up to $250,000 and personal property coverage up to $100,000.
However, NFIP insurance does not cover everything. It does not cover any property besides the main home, so a yard, pool or fence destroyed by floodwater is not covered. It also does not cover valuables or home business financial losses.
With NFIP insurance, the insured is reimbursed for losses on the basis of actual cash value (ACV). That means the depreciation is factored into the claim payout. Depreciation will be determined by your home’s age and condition at the time of the loss.
To buy NFIP flood insurance, search for a participating provider in Texas. Contact the company and inquire about flood coverage, and an agent will walk through the process and explain what is and is not covered. Once the premium is paid — most flood policies must be paid in full upfront — coverage will take effect after the 30-day waiting period.
Private flood insurance
The other option is to buy private flood insurance from a standard insurance provider. Depending on the insurance company, flood insurance is available as a standalone policy or, occasionally, an endorsement on a homeowner’s insurance policy.
Private insurers may offer higher coverage limits than the NFIP, and there may be more flexibility with the policy features. Additionally, private flood insurance may offer replacement cost value (RCV) for your home and personal belongings, which means any damage is paid for at the replacement value.
Before deciding on private flood insurance, research what is required to qualify for coverage. For instance, homes located in very high-risk areas might not be eligible for private insurance. In that case, NFIP insurance might be a good option.
To get private flood insurance, research providers that offer this type of coverage in the area where you live. Keep in mind that many private insurance companies sell NFIP policies. Just because an insurance carrier sells flood insurance doesn’t mean it’s “private” insurance. To be considered a private policy, an insurer must underwrite the coverage themselves.