Texas Homeowners Insurance

Texas homeowners insurance is more expensive than the national average, but you can lower your rates with discounts.

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UPDATED: Jun 23, 2022

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Written By: Chris TepedinoReviewed By: Laura WalkerUPDATED: Jun 23, 2022Fact Checked

Overview

  • Texas is one of the most expensive states for homeowners insurance, with rates averaging $211 per month
  • Farmers and Texas Farm Bureau offer the most affordable home insurance rates
  • To get lower Texas homeowners insurance rates, increase your deductible and bundle your policy with auto insurance

Texas home insurance rates are among the most expensive in the country. If you’re looking for affordable Texas homeowners insurance, shop around for multiple quotes from companies that offer discounts on insurance coverage. 

Keep reading to compare Texas homeowners policies and rates from the state’s top five home insurance companies in the state. We rank each company based on rates, financial strength, and customer service. We also compare home insurance discounts so you can find the best policy at a price for your budget.

How much is Texas homeowners insurance?

The value of your home will have the most significant impact on your Texas homeowners insurance rates. You need to carry enough coverage to protect your home and the valuables you own inside, and higher coverage limits come with higher rates. 

The average cost of a home in Texas is between $300,000 and $350,000. Therefore, you will want enough home insurance coverage to protect the value of your home and personal belongings.

BQ: The average annual cost of homeowners insurance in Texas is $2,537 per year, or around $211 per month, for a $300,000 policy.

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Why are homeowners insurance rates so high in Texas? 

The state is prone to natural disasters. The most common causes of Texas claims are windstorms and tornadoes in the center of the state, while those living on the coast are at an increased risk for hurricanes and storm surges. 

Flooding is also a very common peril throughout Texas, and a standard policy does not cover flood damage. Buying additional flood insurance endorsements can raise your home insurance rates, especially if you live in a high-risk area.

You’re also less likely to get a policy with a standard home insurance company if you live in a high-risk area. For example, most insurance companies are not financially equipped to take on the risk of homes located on the Gulf coast. So if you live on the coast, you may have to shop for high-risk home insurance with higher rates.

Which company offers the most affordable Texas homeowners insurance?

Farmers and Texas Farm Bureau, a local company, offer the most affordable home insurance rates in Texas. However, you may find better rates and customer service with a different insurer.

We gathered information on the top five homeowners insurance companies in Texas to help you better decide which offers the best coverage for your needs:

TX Home Insurance CompanyAverage Annual Home Insurance RatesA.M. Best RatingJ.D. Power Rating
Allstate$2,232A+829
Amica$2,643A+854
Farmers$1,443A-813
Texas Farm Bureau$1,661AN/A
USAA$2,169A++N/A
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The A.M. Best ratings reflect each company’s ability to pay out on claims, while J.D. Power ranks each company based on customer service, product quality, and pricing on a scale of zero to 1,000.

Despite its low rates, Farmers has the lowest financial and customer service score of the top five. While an “A-” from A.M. Best is still a strong financial backing, the low customer satisfaction score might encourage you to compare quotes elsewhere before you buy.

Texas Farm Bureau has a strong “A” rating from A.M. Best. However, it isn’t ranked by J.D. Power because it is a smaller, local company. Fortunately, small insurers have a reputation for higher customer service reviews and cheap rates.

Ultimately, finding the best Texas homeowners insurance company will come down to price, customer service, and personal preference. The remaining companies in the top five charge nearly double the rates but have much higher customer satisfaction. 

We recommend comparing property insurance quotes from these companies to at least three other local Texas insurers to guarantee that you get the most out of your home insurance policy.

Which company offers the best discounts on Texas homeowners insurance?

The most common home insurance discounts you can ask for are bundling policies and installing home security equipment. For example, the best companies will offer you up to 30% off for bundling home insurance with your car policy.

Therefore, you can reduce your expensive home insurance rates by asking your company for discounts on your policy. In addition, other insurers will offer discounts to loyalty members or new home buyers.

Take a look at the table below to see which discounts are offered by top five home insurance companies in Texas. The discount amount is listed if it’s known.

TX Home Insurance CompanyNew Home DiscountBundling DiscountLoyalty DiscountHome Security Discount
AllstateVaries25%10%Varies
AmicaVaries30%NoneVaries
FarmersVariesVariesup to 15%Varies
Texas Farm BureauVariesVariesVariesVaries
USAANone10%10%15%
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Amica is the only company that doesn’t offer a loyalty discount, and USAA doesn’t offer a new home discount, but both provide other hefty discount programs. So, you could earn lower rates with these more expensive companies depending on the discount amount you qualify for.

What is the most common homeowners insurance policy in Texas?

Home insurance coverage options in Texas are similar to those across the country, but most Texas homeowners choose an HOA, HOA+, or HO3 policy.

An HOA is a named perils policy that offers cash value for your dwelling, structures, and personal property for damages specifically listed in your policy. Named perils are often limited to fire and lightning, smoke damage, windstorms or hail, vehicle or aircraft damage, vandalism, theft, and civil unrest.

A HOA+ policy will expand upon the named perils in your HOA policy and include coverages for fallen objects (including trees), ice and snow, and water damage from burst pipes, steam, or freezing.

HO3 policies are more expensive because they provide coverage on an open perils basis. Open perils mean your homeowners insurance will cover any damage unless it is excluded from your policy. The most common home insurance exclusions are flood and earthquake damage.

Texas homeowners also have the option of buying a HOB policy. This unique Texas policy is similar to the national standard HO3 but provides additional water damage coverages Texans need.

What does a home insurance policy cover in Texas?

A standard Texas home insurance policy will cover:

  • Dwelling and other structures. This includes your home, any additions you may have installed, and other artificial constructions on the property that aren’t attached to your house.
  • Personal property. Your standard policy will protect your personal property and belongings up to a certain amount.
  • Liability. Your policy covers medical costs for guests who are injured on your property.
  • Loss of use. Your policy will cover accommodation costs when you are forced out of your home for repairs after filing a claim.

While homeowners insurance isn’t required in Texas, it’s in your best interest to buy a policy to protect your property and personal belongings. 

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Texas Homeowners Insurance: What You Need to Know

Despite having some of the most expensive home insurance rates in the country, you can still find affordable Texas homeowners insurance when comparing policy discounts online.

Farmers and Texas Farmers Bureau offer the cheapest home insurance in Texas. However, you might find lower rates with Allstate or Amica by qualifying for home insurance discounts. Amica and Allstate also have higher customer service ratings than Farmers, which may be important to you if you have a history of filing claims. 

The type of policy you choose will also impact how much Texas homeowners insurance costs. While the most popular type of home insurance policy in Texas is HOA, your protection is limited to the specific damages listed on your policy. Therefore, you may want to buy an HO3 or HOB open peril policy for more coverage.

Your Texas homeowners insurance rates will increase if you choose an open vs. named perils policy, so comparison shop online with at least three different companies to find the most affordable home insurance coverage.

If you have specific questions about Texas insurance laws, contact the Texas Department of Insurance toll-free at (800) 252-3439 or by mail at P.O. Box 149104, Austin, Texas, 78714.

Editorial Guidelines: We are a free online resource for anyone interested in learning more about insurance. Our goal is to be an objective, third-party resource for everything insurance related. We update our site regularly, and all content is reviewed by insurance experts.

Chris Tepedino is a feature writer that has written extensively about home, life, and car insurance for numerous websites. He has a college degree in communication from the University of Tennessee and has experience reporting, researching investigative pieces, and crafting detailed, data-driven features. His works have been featured on CB Blog Nation, Flow Words, Healing Law, WIBW Kansas, and C...

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Written by Chris Tepedino
Insurance Feature Writer Chris Tepedino

Laura Walker graduated college with a BS in Criminal Justice with a minor in Political Science. She married her husband and began working in the family insurance business in 2005. She became a licensed agent and wrote P&C business focusing on personal lines insurance for 10 years. Laura serviced existing business and wrote new business. She now uses her insurance background to help educate...

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Reviewed by Laura Walker
Former Licensed Agent Laura Walker

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