Texans dealing with property damage from Hurricane Beryl may be in for another rude awakening. The Texas Windstorm Insurance Association (TWIA) is considering a 10% rate increase on premiums. The TWIA board is expected to vote on the rate hike this week, but the Texas Insurance Commissioner would have to sign off for it to take effect. TWIA says the increase is necessary because of rising costs to insure more people, as higher property values and construction costs are making claims more expensive.
The TWIA, which is the non-profit insurer of last resort for homes and businesses in 14 Texas coastal counties and parts of Harris County, has seen its coverage base grow by more than one-third since 2020. Most TWIA customers are those who can't get private insurance. "Less and less insurers are willing to risk placing insurance on the coastline, " says Ron Snouffer, Texas insurance adjustor with National Claims Negotiators. "That's because insurance companies don't want to be taking the risk of being on the hook for huge catastrophe claims."
"So that means there are less options for property owners," he continues. "Which means you're going to be forced into basic insurance or having to go with TWIA."
TWIA officials estimate the agency has received 25,000 claims for damage resulting from Beryl, with a total value to exceed $200 million. This as overall property insurance rates are rising across Texas. "That's not surprising," says Snouffer. "Construction costs have gone up drastically in the last five years, and a big part of your insurance premiums is the rebuild process...if it costs more to rebuild your house, it costs more to have it insured."
Texas lawmakers have proposed taking action in next year's Legislature to rein in insurance costs. In the meantime, Snouffer recommends residents shop around and use a broker if necessary. "Make sure you're comparing apples to apples when it comes to coverage, because just because you have a cheaper rate doesn't mean you have better insurance," he tells KTRH. "A lot of insurance companies are actually reducing coverage to give you discounts, but then you don't realize you don't have certain coverage until you need it."
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