Average Cost of Texas Home Insurance

The average cost of Texas home insurance in 2009 was $1409 which is 58 percent higher than it was in 2008. Further, it is 58 percent higher than the next highest state which is Florida. In fact, the national average for homeowners insurance is only $804.

Texas has a higher number of claims because of hail, tornado and wind damage. This raises the average cost of insurance in the state. Mold also plays a role. The state legislature passed a law in 2003 requiring insurance companies to reimburse homeowners for mold treatment which increased the overall cost of insurance as well.

Is it fair that Texas residents have to pay so much for claims that are low compared to hurricanes and earthquakes. Well, you have to realize that in Florida, for instance, homeowners are required to purchase a separate hurricane rider which is in addition to their normal homeowners insurance. This makes the cost of their homeowners insurance look like it is lower but for comprehensive coverage, they need additional insurance.

Another issue is catastrophe funds. Texas requires it while other large states like Florida and California do not.

But Texans don’t see any relief in these cold hard facts. In fact, what they do see is that their insurance rates have been rising by double digits year after year.

The state legislature is considering what they can do to lower the insurance rates. One proposal will require the largest insurers to get permission from the state to increase their rates. However, if they make their requirements too stringent, insurers may just up and leave the state so they have to be careful about the policies they make.

However, the legislature cannot stop the weather related property damage so even if there is relief in future rate hikes, Texans are likely to continue to have among the highest rates in the country.

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