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Finding alternate windstorm insurance after TWIA rate hike

Posted at 6:19 AM, Aug 30, 2018
and last updated 2018-08-31 13:01:06-04

Earlier this month the Board of Directors for TWIA, the Texas Windstorm Insurance Agency, narrowly approved a 10 percent rate increase.

This increase would affect all new and policy renewals for both residential and commercial properties.

Homeowners and those who own commercial property along the Gulf Coast could face a big insurance rate hike come January 1 if TWIA gets the approval from the Texas Department of Insurance.

“They feel like they need a 32 percent rate increase. But the board has approved a 10 percent rate increase, and on top of that, there is a possibility of another 4 percent increase for just cost of living adjustments,” said Insurance agent Ed Cantu.

There is no 4 percent  cost of living adjustment being proposed by TWIA or considered for approval by TDI. The TWIA Board of Directors voted to file an increase to TWIA’s maximum liability limits (or the maximum amount of insurance that can be purchased) at the July 31 Board meeting. This is an annual filing required by Texas law to adjust the amount of coverage a policyholder can purchase on their home. If approved by the Commissioner, it would not affect policyholder premiums.

Texas Windstorm Insurance Association had more than 76,000 claims submitted after Hurricane Harvey with total paid losses estimated at $1.61 billion from the storm.

TWIA secured $4.9 billion in funding for the 2017 hurricane season, and have used the total amount available in their Catastrophe Reserve Trust Fund for the payment of Harvey claims. TWIA has also secured $4.6 billion in funding for the 2018 season.

“It is really hard now because there are so many people that, even a year later, people in the Rockport, Aransas Pass, Port Aransas area that still have not recovered. Some of them are still under reconstruction. On top of that, to have another 10 – 14 percent rate increase makes it very difficult,” said Cantu.

According to the TWIA’s website, its average residential policy currently costs $1,500 annually. If you think these numbers are a bit too high and affecting your budget, there are other options out there.

“TWIA is not the only answer. There are alternative insurance companies that are willing to provide just the windstorm insurance. They are a little more selective on what they will take, but because of that, their rates are actually 15 percent or up to 15 percent lower than what TWIA rates are now,” said Cantu.

“They are not well known, but they are admitted companies that do have the financial means to pay their claims. One of the companies I represent is called Velocity, another company is called Weston Insurance, also the Woodlands out of the Houston area, and a company called Maison Insurance, and all they do is specialize in windstorm insurance. The rates are adjusted like a real insurance company is supposed to unlike TWIA where everybody pays the same rates. If your home is further away from the Gulf, you are in the Calallen area, Robstown, Kingsville, or an area that is not quite close to the coast, their rates are even lower then what they would be, say, if you were on Padre Island or Corpus Christi Bay,” said Cantu.

For more windstorm insurance information visit:

The premium increases – for insurance policies covering wind and hail damage to property primarily in coastal areas of the state.

TWIA was created by the Texas Legislature as an insurer of last resort for those living in coastal counties who could not otherwise purchase insurance in the private market.