Texas Windstorm Insurance

Windstorm insurance is important for anyone insuring a personal or business property on or near coastal waters. If you’re new to one of Texas’ 14 coastal counties or to the Texas Windstorm process, navigating the maze of windstorm regulations can be as perilous as sailing through stormy waters.
Texas has a unique method of handling windstorm and hail insurance. Unlike many other coastal states that have uniform laws and regulations, Texas favors a market-lead system with varying degrees of regulation between counties. The lack of uniformity and consistency can cause confusion, uncertainty, and mistakes – with big costs to home and business owners who fail to get proper certification during construction or renovation projects, then later attempt to obtain windstorm insurance.
This guide examines the most important things you need to know before, during and after obtaining windstorm insurance in Texas.

Overview

There is no requirement for Windstorm Insurance in Texas, but almost any mortgage company will require coverage as part of their terms. Even if you are building your own structure, from your own pocket without use of a mortgage, it is a good idea to build any structure compliant to windstorm specifications. Because inspections can only be made during construction, the Certificate of Compliance is a major selling point guaranteeing code compliance and windstorm insurance eligibility. If you build or renovate a major structure without obtaining a Certificate of Compliance, re-selling the structure down the road can be very challenging as it will be ineligible for windstorm insurance or will require a heavy surcharge to the policy premium.

It is important to have windstorm protection well before a hurricane is projected to come near your home or business. Once a hurricane enters the Gulf of Mexico, you can no longer purchase new or additional windstorm insurance coverage in Texas until after the storm has made landfall and cleared your area.

Flood insurance is equally important to coastal home and business owners, but offers no protection from wind or hail damage. Just as flood insurance doesn’t provide for wind damage, windstorm insurance provides no protection from flooding. Coastal residents would be well-advised to obtain both types of insurance.

COASTAL COUNTY RESIDENTS:

Before you build, repair or remodel inquire about a Windstorm Insurance Inspection,
the Texas Windstorm Insurance Association (TWIA) is the state’s insurer, which is the last resort for wind and hail coverage in the 14 coastal counties and parts of Harris County. TWIA provides wind and hail coverage when insurance companies exclude it from Homeowners and other property policies sold to coastal residents or businesses.

If you are planning to build or renovate any structure in the counties listed below, then you should contact your insurance agent about the Windstorm Inspection Program in order to obtain or maintain windstorm and hail insurance through TWIA.

Coastal Counties and Areas Effected:

Aransas, Brazoria, Calhoun, Cameron, Chambers, Galveston, Jefferson, Kenedy, Kleberg, Matagorda, Nueces, Refugio, San Patricio, Willacy, or in the following cities if your property is located east of State Highway 146 in Harris County: La Porte, Morgan’s Point, Pasadena, Seabrook, or Shore Acres
While not required for all construction, the following projects typically require an inspection for windstorm insurance purposes:

•    New Structures
•    Additions
•    Alterations
•    Re-roofs
•    Repairs

Windstorm insurance inspections under this program must be made by either a Texas Department of Insurance (TDI) inspector or an engineer, who has been appointed by the Commissioner of Insurance.
Important: TDI inspectors are unable to inspect a property after construction is completed. Therefore, all inspections must be made during the construction phase. A good rule of thumb is to call for an inspection immediately after your building material has been delivered and before construction begins.
If you have any questions or need additional information, call your Insurance Agent or visit the TDI web-site at: www.tdi.texas.gov or call the Austin Office or one of the field offices.
You must also have fair credit, and no more than $3000 in PAST DUE debit.    If you have had a bankrupcy within the past 3 years, you must disclose what type of filing and when it was discharges.
During probation period you will be asked to obtain your property and casualty license.

Austin         800-248-6032
Beaumont    409-833-3756
LaMarque    409-986-9552 or 281-474-5025
Angleton         979-848-0953 or 979-244-9451 or 361-552-2501
Corpus Christi    361-421-4675 or 956-421-467

Inspections Overview

The Texas Department of Insurance (TDI) is the primary government agency involved with windstorm insurance. TDI offers free inspections to new construction and renovation projects. These inspections should be scheduled through your contractor and must be conducted during the construction phase. Once a project has been completed, TDI inspectors are no longer able to grant approval to your structure.

Because TWIA processes and rules are not flexible under any circumstances, it is important that you hire a builder/contractor who is familiar with and follows the guidelines. Cutting financial corners during construction can cost you more money in the long run. Likewise, the TWIA policy and procedures for writing and binding coverage correctly are very specific and do not allow for any exceptions to their rules. It is also important that, when selecting an Insurance Agent, you choose someone who is very familiar with TWIA to be sure you have the proper coverage and endorsements.