When looking at Texas home insurance, one of the first things that Texans want to know is what their wind and hail deductible is going to be. If you live in Dallas or Ft Worth, you realize that the likelihood of a hail claim is extremely high. Since we have a storm season in both the spring and the fall, it feels like we never get a break from it. But Collin County residents should feel alone as other parts of the state have storm problems as well. Greater Houston and the Gulf Coast deals with substantial storms including Hurricane season. If you live in on the High Plains in Amarillo or Lubbock you've probably had the good fortune of witnessing a tornado or two. And Austin and Waco don't get left out either as storms happen up and down the I-35 corridor. THIS is why so many Texans want to know what a wind-hail deductible is and why they have to care?
What Is A Wind & Hail Deductible?
The Basics of Home Insurance - Deductible
Each Texas home insurance policy has many provisions included in it to define the coverage that you have with that insurance company. One key section in each policy that is devoted to deductibles. An insurance deductible is the amount of money that your insurance carriers expect you to pay before they make your whole in a covered claim. On Texas Home Insurance policies, deductibles can be as simple as a single standard deductible for all claims or you can have as many as three different deductibles with some insurance companies.
Wind Deductibles
If you have separate deductibles for different types of perils, we typically see up to three different deductible types. You can see a stand alone Tropical Storm (Hurricane) deductible, potentially a separate Wind & Hail deductible, or a Wind Deductible which incorporates all of hurricanes, wind, and hail. There is also an All Other Perils deductible for anything that is not wind, hail, or hurricane related.
The Wind and Hail deductible is applicable when damage to your home comes from a storm that has either high winds or hail damage. Or even both! It typically is applicable to your roof, but can also impact other places on your home or property like windows, fences, gutters, and siding. Since hail storms have become the single most frequent claim in Texas, the home insurance companies have separated this line item out in an attempt to control claim costs.
Cost Controls From Hail Damage
In an attempt to contain claim costs from hail coverage, home insurance companies have begun to put different parameters in place to make it more difficult for Texas homeowners to complete a claim without paying the deductible. These changes to the deductible have moved them from being a small, flat dollar amount like $500 or a $1,000 deductible option to what is known as a percentage deductible with all insurance providers. The percentage deductible is calculated as a percentage of your dwelling amount on your policy which is located on your declaration page. Many Texas Home Insurance policies have set a mandatory minimum wind hail deductible at 1% of that dwelling amount, though some companies have moved the storm deductible to a minimum of 2% or more if you are located in specific geographic areas like Collin County. In coastal areas, the hurricane deductibles have in some cases moved even higher than 2% of the dwelling value for those insurance claims.
These moves are primarily because roofing contractors will inflate your hail claim amount knowing that the insurance companies will approve the requested work. After getting approval at the inflated insurance coverage amount, they then simply would not complete all of the approved work as described in the hail loss. The money buffer between what was approved under the hail coverage and the work and materials that was actually performed allows the homeowner to suffer no out of pocket expenses while the roofing company can still maintain their profit margin. The practice became so commonplace that even the Texas Legislature enacted a new law during the 2019 session prohibiting the waiving of deductibles. This move was pushed by the insurance industry in an attempt to keep the premiums from homeowners insurance policies from continuing to skyrocket. It hasn't seemed to work well at all as property insurance premiums have continued to rise through 2023.
How Does This Affect Me?
Obviously, the new legislation has not worked out very well in keeping those premiums in check. It has however changed how claims from hail events are handled and processed. Many companies are keeping a much tighter cost control on the claim expenses associated with hail coverage in an attempt to keep windstorm deductibles and premiums reasonable. Please have some understanding that asking for documentation on proof of completed work is simply the insurance company doing their job while keeping contractors honest. This will help keep property owners' costs down in the long run where wind damage is concerned.
Beyond that, make sure that when you are shopping for a home insurance policy, make sure that you are receiving TRUE Texas Home Insurance. Our promise to property owners in Texas is two fold on your home insurance policy where wind damage is concerned. We make sure that your windstorm deductible is the lowest possible amount for the geography that you live in. Since that percentage deductible can vary between Houston, Austin, Ft Worth, and Amarillo, we simply commit to keeping the deductible amount as low as possible. The second part of the promise is to make sure that your claim will be settled as replacement cost rather than actual cash value. Many Texans are finding that their great wind damage deductible is not as good as they thought when the depreciation factor of the "roof payment schedule" is applied after the weather event happens.
How Can I Get The TRUE Texas Home Insurance?
Working with an experienced independent insurance agent can help you navigate the waters of differing deductibles and claim settlements. Insurance For Texans has highly trained professionals that can point out the differences for you as well as provide guidance to companies that can match your needs to the pricing that you are looking for since we are independent insurance agents. Just click the button below to get get started on your path to understanding your home insurance policy fully.