Is homeowners insurance required in Texas?
Texas does not legally require homeowners insurance. Your mortgage lender almost certainly does, as a condition of the loan, and they will require it for as long as you carry the mortgage. Even if you own your home outright, a policy protects an asset most households could not afford to replace out of pocket. So while the state does not mandate it, going without it is rarely a real option.
What does a standard homeowners policy cover?
A standard homeowners policy generally covers several things at once: the structure of your home, other structures on the property such as a fence or detached garage, your personal belongings, your liability if someone is injured on your property, and additional living costs if a covered loss makes your home unlivable for a time. The exact limits and terms vary by carrier, which is one of the reasons comparing policies matters.
What homeowners insurance does not cover
The most common gap is flood. Flood damage is not covered by a standard homeowners policy and requires a separate flood policy, through the National Flood Insurance Program or a private carrier. Wind and hail are usually covered in North Texas, but how a carrier pays a roof claim can differ a great deal, and some policies handle roof payments on a depreciation schedule rather than full replacement cost. We will walk through these details with you rather than letting you find out at claim time.
Replacement cost vs actual cash value
This distinction decides how much you actually receive after a loss. Replacement cost pays what it takes to repair or replace the item at today’s prices. Actual cash value pays the depreciated value, the replacement cost minus wear and age. A five-year-old roof settled at actual cash value can leave a sizable gap between the check and the repair bill. We make sure you know which basis your policy uses, for the dwelling and for your belongings.