The old adage that “everything is bigger in Texas” can be applied to homeowners insurance as well. The average rate for homeowners insurance in Texas is $2,589 per year, which is higher than the national average annual premium of $1,477. The Lone Star State is subject to a number of hazards, including flooding, tornadoes, sinkholes, hurricanes/tropical storms and wildfires. Therefore, it is essential to have the best home insurance in Texas to protect your home and property from the inevitable. Luckily, homeowners have plenty of choices when it comes to home insurance.
The best home insurance companies in Texas
The table below compiles the five most well-known and well-reviewed providers in Texas according to the 2020 J.D. Power U.S. Home Insurance Study.
|Home insurance company||Average annual premium for $250k dwelling||J.D. Power score|
Amica Mutual routinely ranks as one of the best insurance providers in the country. This comes from J.D. Power, AM Best and individual customer reviews. Amica offers a wide range of insurance products, including home, auto, umbrella and even flood insurance.
One of the most unique features about Amica is its dividend policy. Policyholders who choose this option are eligible to get up to on average 20% of their annual premium back each year.
Learn more: Amica Mutual Insurance review
State Farm is a national insurance provider that offers multiple insurance products along with homeowners insurance. For example, you can get car insurance, motorcycle insurance, life insurance, boat insurance and many others. Policyholders who purchase more than one policy type with State Farm can save with their multi-policy discount.
State Farm offers a slew of coverage options and can even work with the National Flood Insurance Program on your behalf to obtain coverage for flood damage.
If you are looking for 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.
Learn more: State Farm Insurance review
Allstate offers numerous coverage options, as well as a variety of ways to save on your premium. One of Allstate’s most unique features is its online presence. It 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 policy.
Learn more: Allstate Insurance review
Farmers is a full service insurance provider that offers home, auto, renters, business, condo and life insurance. It offers three customizable homeowners insurance plans for its members 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 lowers your deductible by $50 for each year that your policy is in force. You may also want to consider the cosmetic damages option or claim forgiveness.
Learn more: Farmers Insurance review
USAA currently sell insurance only to active or former military members and their families. However, if you are eligible, USAA may be a great option. You can do everything that you can do with other insurance providers, such as bundle and save, choose from a variety of coverage options and do everything you need to do via its 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. Additionally, USAA is member-owned, so its customers get paid dividends each year just for choosing USAA as their insurance provider.
Learn more: USAA Insurance review
Average cost of homeowners insurance in Texas
Texas homeowners insurance premiums are often higher than other states due to the number of natural disasters the state is subject to. Insurance premiums are largely based on risk, and if an area has a greater likelihood of homes being damaged, the premiums will generally be higher to offset that risk. To compensate for this, you may want to shop around to take advantage of available discounts and find the best price.
The average insurance premium for a Texas homeowner is $2,589 for a $250,000k dwelling. Texas homeowners pay quite a bit more than the national annual average of $1,477 for homeowners insurance due to the environmental hazards and geographic location.
Texans are not alone in paying more than the national average premium for homeowners insurance. In fact, none of the states that border Texas feature lower-than-average premiums. The average annual premium in Oklahoma is $4067, likely due to the high risk of tornadoes and wind damage. The average premium in Louisiana is $2,297 per year, and policyholders in Arkansas pay an average of $2,302 per year. However, New Mexico homeowners pay slightly closer to the average annual premium, with annual average rates of $1,545.
Home insurance considerations in Texas
As with all states, Texas has its own unique set of insurance considerations. Texans should be aware of these state-specific factors when shopping for homeowners insurance.
Home insurance coverage options in Texas
Buying homeowners insurance does not need to be overwhelming and stressful. Below, find some information on the type of insurance coverage you’ll most likely encounter and what they are used for:
- Dwelling coverage: This is your standard insurance policy and it covers the physical structure of your property.
- Personal property coverage: You want personal property coverage for your belongings, whether inside or outside of your home.
- Liability protection: Liability protection covers you in case someone is hurt on your property or you damage another person’s property.
- Guest medical protection: This coverage is specifically to cover people who are injured on your property.
In addition to these standard types of insurance coverage, most insurance companies offer optional coverage that you can add on to your policy for more protection:
- Flood insurance: If you live in or near a flood-prone area, you may want to consider buying a separate flood insurance policy to protect yourself in the event of a flood. Though you can get an idea about whether or not you live in a flood prone area by inputting your address into a FEMA flood map, you will also want to also look at your area’s history of flooding.
- Wind/hail coverage: Some companies may automatically exclude damage for wind and hail, especially if you are in an area prone to damage from these hazards. You may be able to buy the coverage back with an endorsement, or you may need to buy a separate policy.
- Seepage and leakage: This endorsement may cover damage from slow leaks or seepage from cracks.
- Water backup coverage: This option provides coverage for the backup of drains or sewer lines, often from sump pumps not being able to keep up with heavy rains.
Although historically flood insurance could only be purchased from the U.S. government, some private carriers do now offer flood insurance policies. You can call your agent to see if they can facilitate your purchasing of a policy through the National Flood Insurance Program (NFIP), or if they have any private carriers who offer flood coverage.
You may even want to consider flood insurance if you do not live in a flood zone. According to the NFIP, 99% of all U.S. counties experienced flooding between 1996 and 2019.
Texas common causes of loss
In Texas, there are some types of claims that are more common than others. Home damage caused by nature is a common occurrence and is one of the reasons why you should have insurance.
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” — which made landfall in Texas in 2017. Some of the most common homeowners insurance claims in Texas are:
- Water damage, including plumbing issues and burst pipes, but not including flood damage
- Hail damage from thunderstorms and hurricanes, but not extended to shrubs and trees
- Wind damage from thunderstorms, hurricanes and tornadoes
- Theft and/or burglary of property
- Fire damage caused by lightning
You will want to be very careful about your policy as it concerns wind and hail. If you live near the coast, your policy may exclude wind and hail damage. If it does, you will likely need to purchase additional protection. Check for exclusions for roof damage caused by hail, as well as exclusions for tornado damage caused by high winds.
If you have any questions about a policy, it may be a good idea to talk to an agent. A licensed insurance professional can review your policy and help you identify areas where you may need to purchase separate coverage.
Recommended coverages in Texas
Each homeowner in Texas will have a unique policy, likely tailored to the risks they believe are most important. However, there are some risks that nearly all Texans should consider insuring against.
- Wind/hail damage: In parts of northern and eastern Texas, tornadoes are common and can cause widespread wind damage. If you live in these areas, it may be wise to check if your policy covers damage caused by wind and hail.
- Hurricanes: The Gulf coast of Texas is frequently affected by hurricanes, which can also often track north and east across the state. Hurricane damage is often not covered by a standard home insurance policy, so homeowners in these areas of Texas may need to purchase separate hurricane insurance.
- Flooding: Many parts of Texas are at risk for flooding, and the average flood insurance claim paid by the National Flood Insurance Program is $54,200, higher than the national average claim amount of $52,000. As with hurricane damage, flood damage is generally not covered by standard homeowners insurance and homeowners may want to consider a separate policy.
Because Texas is a large state and the types of insurance risks can vary greatly depending on where you live, it may be best to work with a licensed agent to determine what coverages you should consider insuring your property against.
Frequently asked questions
What is the cheapest homeowners insurance in Texas?
The cheapest insurance in Texas depends on a number of factors, including the value of your home, the area in which you live, what type of home you live in and what type of coverage you select. Your deductibles and coverage limits will make up a portion of the cost.
How do I get homeowners insurance in Texas?
If you need homeowners insurance, obtain quotes from multiple carriers to compare rates, coverage options and discounts. Knowing your current coverage limit or having an idea of how much your home would cost to rebuild may be important. Each company will have tools to determine the rebuilding value of your home, but if you determine that number independently you can make sure your home is not being under- or over-insured.
Additionally, knowing what factors matter most to you in an insurance company will help you to narrow down your options. Are you most concerned with price? Does financial stability matter to you? What about customer reviews? If you are unsure where to start, a licensed agent may be able to help you find the right policy for you.
What do I need to get homeowners insurance in Texas?
Whether you are buying your home or just looking to switch to a new insurance provider, you will likely need to provide some personal information, as well as your home’s address. Any additional information that is needed will be requested by the insurance provider.
Does my homeowners insurance cover COVID-19 losses?
The effects of the coronavirus pandemic are unprecedented, leaving many wondering if a homeowners insurance policy would cover the cost of sanitizing a home if the inhabitants were infected with the COVID-19 virus.
Although many people are spending more time at home to shelter in place and work remotely, there is no legislation on the matter. Additionally, insurance companies are reacting to the changing situation quickly, and coverage offerings may shift on a weekly or even daily basis as the situation unfolds. It’s It is best to check what kind of coronavirus coverage you may have on your homeowners insurance policy by calling your insurance company.
Bankrate utilizes Quadrant Information Services to analyze rates for all ZIP codes and carriers in all 50 states and Washington, D.C. Quoted rates are based on 40-year-old male and female homeowners with a clean claim history, good credit and the following coverage limits:
- Coverage A, Dwelling: $250,000
- Coverage B, Other Structures: $25,000
- Coverage C, Personal Property: $125,000
- Coverage D, Loss of Use: $50,000
- Coverage E, Liability: $300,000
- Coverage F, Medical Payments: $1,000
The homeowners also have a $1,000 deductible and a separate wind and hail deductible (if required).
These are sample rates and should be used for comparative purposes only. Your quotes may be different.
Rates are determined based on 2020 Quadrant Information Services data.
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First: we evaluated customer satisfaction and complaints, financial strength and stability and overall costs based on average rates quoted to real drivers.
Second: we evaluated customer experience by assessing each provider’s customer service options through online capabilities and agent accessibility.