Is flood insurance required in Texas?

Flood insurance is not required in Texas by state law, but lenders require you to carry flood insurance, particularly if you’re located in a high-risk area. 

Flood risk extends well beyond the Texas coast. The Texas Department of Insurance notes that flooding is a risk across the state, including in major metropolitan areas. If your home is in a Special Flood Hazard Area and your mortgage is federally backed, federal rules obligate the lender to require flood insurance.

But even if you’re not required to get flood insurance, it’s still often prudent to do so. Flash Flood Alley, a region of Texas known for flooding, stretches across much of the center of the state, covering areas like San Antonio, Austin, and Dallas. Per the Texas Department of Insurance, nearly every major city in Texas faces a high risk of flooding.

“Many homeowners feel that if they are not in an area prone to flooding, or didn’t flood during Harvey, or never flooded before, they shouldn’t need flood insurance.  The fact is that the risk is changing all the time,” says Tara LaGoy, agency owner, Tara LaGoy Insurance Agency, based in Spring, Texas.

“So, flood insurance is worth considering for every homeowner,” she says.

How much is flood insurance in Texas?

The average cost of an NFIP flood insurance policy in Texas is $1,116 per year, which is lower than the nationwide average annual flood insurance cost of $1,271. The cost of flood insurance in Texas depends on where you buy the insurance and your location, as well as factors like deductibles and coverage limits. 

The most common way to get flood insurance in Texas is through the NFIP, says LaGoy.

“Costs have risen over time and so have premiums.  Just as with homeowners insurance, costs can be mitigated by increasing deductibles,” notes LaGoy. 

“Another option is to consider private flood insurance, which will often offer broader coverage, a single deductible, optional coverage such as extra living expenses after a loss, replacement cost on contents, and sometimes lower premiums,” she adds.

What does flood insurance cover in Texas?

Flood insurance covers flood damage to your home and belongings, but the amount and type of coverage depend on the policy. An NFIP policy provides up to $250,000 in building coverage and $100,000 in personal property coverage. Private flood insurance offers higher limits and additional benefits. 

An NFIP policy covers up to:

  • $250,000 for your home
  • $100,000 for personal property
  • $30,000 for compliance with state and local laws regarding repairs and construction due to flood damage

“This policy form provides basic coverage with replacement cost coverage on the home, depreciated coverage on contents, and a deductible for the dwelling with a separate deductible for the contents,” explains LaGoy.

Private flood insurance, however, includes broader coverage, such as for living expenses if you’re displaced due to flooding, along with higher coverage limits.

In terms of the types of events that flood insurance covers, these policies apply to flooding from exterior events, such as storms that cause runoff from bodies of water or mudflows. In contrast, interior flooding due to a plumbing issue like a burst pipe falls under regular homeowners insurance. And when a storm causes interior flooding due to damage to the home, such as a roof leak, that would also fall under regular homeowners insurance, not flood insurance.

What companies offer flood insurance in Texas?

Homeowners in Texas can buy flood insurance through the National Flood Insurance Program (NFIP) or from private insurers. Companies such as Allstate, Allied Trust, and Wright Flood participate in the NFIP’s Write-Your-Own (WYO) program, which allows them to sell and service NFIP policies. 

Some of these top flood insurance providers include:

  • Allied Trust
  • Allstate
  • The Hartford
  • Philadelphia Insurance Companies
  • PURE Insurance
  • Wright Flood
  • USAA

In addition to these NFIP options, some companies also offer private flood insurance. Some homeowners buy both to supplement NFIP coverage. Or, if you’re looking for the cheapest flood insurance in Texas, you might be able to find a private flood insurance provider that beats NFIP pricing, depending on your situation.

Some of the top private flood insurance companies include:

  • Chubb
  • Neptune Flood
  • Palomar

Keep in mind that some Write-Your-Own program insurers also sell private flood insurance policies, giving you more options. 

For example, Wright Flood sells NFIP policies as well as private flood insurance policies in Texas, with the latter having higher dwelling coverage limits, up to $1 million. The cheapest flood insurance in Texas varies based on your home and the coverage you choose.

Different insurers offer different advantages in terms of customer service, premiums, coverage limits, etc. So, if you want the best flood insurance in Texas, it’s helpful to get quotes from different providers — both for NFIP and private flood insurance policies — to see what works well for your budget and risk tolerance.

Sources:

FAQ: Flood insurance in Texas

Does flood insurance cover temporary living expenses?

No. NFIP flood insurance does not cover additional living expenses if a flood makes your home uninhabitable. Some private flood insurance policies include temporary living expense coverage, so check the policy terms before buying.

No. Flood insurance does not cover cars or other motor vehicles. Comprehensive auto insurance covers flood damage to a vehicle, subject to the policy's deductible and terms.

Flood insurance covers sewer backup when the backup directly results from flooding. It does not cover sewer backup caused by another problem, such as a blocked or damaged sewer line.

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