Additional home insurance coverage types 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: 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. Flood insurance is offered through the federally backed National Flood Insurance Program and many private flood insurers. 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 state-backed 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, some 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 value (RCV) coverage, 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.
Texas also has separate deductibles for certain losses. In this state, natural disasters, like named tropical cyclones and hailstorms, 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 percent wind deductible, you are responsible for the first $5,000 of a wind or hail damage claim before the insurer will pay toward the damage.
If you have any questions about a policy, consulting with 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.
