How Bankrate chose the best homeowners insurance in Texas
To find the best home insurance companies in Texas, Bankrate first analyzed average homeowners insurance premiums obtained from Quadrant Information Services for the largest insurance providers in the state by market share. However, because the price is only one feature of a home insurance policy, we reviewed each company’s coverage offerings, discounts, customer satisfaction scores, complaint indexes, financial strength ratings and digital tools. Our methodology was specifically created to help you gain a well-rounded view of each company.
- Texas homeowners insurance costs an average of 34% more than the national average based on 2022 data.
- Texas experiences hurricanes, strong summer storms, hail and tornadoes, so the best companies include those with outstanding claims experience.
Best home insurance companies in Texas
Our research shows that some of the best homeowners insurance in Texas include USAA, State Farm, Nationwide, Allstate and Farmers. When shopping for the best homeowners insurance, Texas property owners may want to consider getting quotes from these carriers.
|Home insurance company||Bankrate Score||Average annual premium*||J.D. Power score||AM Best rating|
*Rates are for annual policies with $250,000 in dwelling coverage
**Not officially ranked by J.D. Power due to eligibility restrictions
USAA only sells insurance to active or former military members and eligible families. If you are eligible, USAA may be a great option. Like many other insurance providers, you can bundle and save, choose from a variety of coverage options and manage your policy in the USAA mobile app. USAA offers unique protections to service members. For example, active-duty or deployed service members can rest assured that their military uniforms are covered.
State Farm is a national insurance provider with a large network of local Texas agents. The provider also offers multiple insurance products along with homeowners insurance. For example, you can get auto insurance, motorcycle insurance, life insurance and boat insurance. Policyholders with more than one State Farm policy type may save with a multi-policy discount. If you want a company that offers discounts and convenient ways to access your account either online or via a mobile app, State Farm may be a good choice.
Nationwide makes it easy to personalize your policy to your specific needs. With options like Valuables Plus, Replacement Cost Plus and Better Roof Replacement, Nationwide may help your insurance coverage go further during a claim. The carrier also offers a list of discounts and sells several other types of insurance. If you like bundling your policies with one company, Nationwide also offers auto, motorcycle, classic car and RV insurance, among other products.
Allstate offers numerous coverage options and a variety of ways to save on your premium. One of Allstate’s most unique features is its online presence. The carrier offers a variety of tools and free resources on its webpage for both members and non-members. Members can learn more about Allstate’s insurance products and learn how to make the most of their policies.
Farmers offers home, auto, renters, business, condo and life insurance. The homeowners insurance company offers three customizable plans to choose from: Standard, Enhanced and Premier. Farmers also offers unique features to help customize your policy. You can enroll in the Declining Deductibles program, which may lower your deductible each year that your policy is active. You may also want to consider the cosmetic damages option or claim forgiveness.
How much is homeowners insurance in Texas?
Texas residents pay an average of $1,860 for $250,000 in dwelling coverage when it comes to home insurance. In Texas, homeowners insurance premiums are higher than in other states possibly due to the increased number of natural disasters. Insurance premiums are largely based on risk, and if an area has a greater likelihood of homes being damaged, the premiums are generally higher so that insurance companies can prepare for a potential claims payout.
Texas homeowners pay 34% more than the national annual average cost of home insurance, which is $1,383 per year. This higher premium average could be due to the environmental hazards and geographic location, making claims more frequent.
Common causes of claims in Texas
In Texas, some claims are more common than others. Home damage caused by nature is a common occurrence and is one of the reasons why you should strongly consider buying home insurance. Common claims include:
- Hurricanes: Hurricanes represent one of the most significant sources of claim costs in certain areas of Texas. As the National Oceanic and Atmospheric Administration (NOAA) notes, “It is estimated that Hurricane Harvey alone had total costs of $125 billion.”
- Wind: In addition to high winds from hurricanes along the coast, most of Texas also experiences high wind from summer storms and tornadoes.
- Fire: According to the Insurance Information Institute (Triple-I), Texas presents the second-highest risk in the nation for wildfires, with over 717,000 properties at risk for damage.
- Flooding: According to the Federal Emergency Management Agency (FEMA), only a handful of Texas counties are at low-to-moderate risk of flooding. Most counties in the state have a relatively high risk for flood damage.
Home insurance coverage options in Texas
In addition to the standard insurance coverage types, Texas homeowners may want to consider some additional endorsements and even separate policies to gain more coverage:
- Flood insurance: If you live in or near a flood-prone area, you may want to consider buying a separate flood insurance policy to help repair damages if your home floods. You may be required to purchase flood insurance in some cases. Understanding your flood insurance requirements prior to moving could help you make informed decisions.
- Wind/hail coverage: If you live near the coast or in another wind-prone area, your policy might exclude wind coverage due to the increased risk of related damage to your home. In cases where you cannot get coverage through your insurance company, the Texas Windstorm Insurance Association (TWIA) can help provide coverage.
- Seepage and leakage: This endorsement may cover damage from slow leaks or seepage from cracks.
Additionally, insurance experts have noted a recent trend in Texas where insurance companies offer “ACV only” settlement clauses for wind and hail damage. ACV stands for actual cash value, which means the market value of the item minus depreciation. While an ACV clause or policy will be less expensive than replacement cost (RCV), it will also mean lower coverage for whatever items are covered under that clause or policy. Check for exclusions for roof damage caused by hail and consider purchasing additional coverage if needed.
The state of Texas also has separate deductibles for certain losses. In this state, natural disasters, like hurricanes, wind and named storms, may have a separate deductible from your policy deductible. This is usually a percentage deductible of your dwelling coverage amount – typically between 1 and 5 percent.
For example, if your home is insured with $250,000 in dwelling coverage and you have a 2% wind deductible, you are responsible for the first $5,000 of a wind damage claim before the insurer will pay toward the damage.
If you have any questions about a policy, talking to an insurance agent may be a good idea. A licensed insurance professional can review your policy and help identify areas where you may need to purchase separate coverage or adjust your current coverage.
Frequently asked questions
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