Homeowners Insurance Texas 126

Homeowners in Texas are responsible for ensuring their property according to protection levels defined by the Texas Department of Insurance. Buying the wrong insurance policy type can make submitting a claim into a major financial problem. Standard homeowners insurance in Texas use standard form modifications, known as HOA, HOB, and HOC coverage types.

Most homeowners in the U.S. submit homeowner insurance policy forms HO1-HO3, HO5/HO8, but Texans must submit slightly different forms. For instance, the HOA form (Basic Named Perils Policy) vs. the HOA+ form (Broad Named Perils Policy) can make a difference. Take a moment to learn more about these protection types:

1. HOA is considered the most basic, simple Texas homeowners insurance policy. The HOA is comparable to HO1 policies outside of the state. Texas HOA policies protect the homeowner from 10 perils.

By definition, a peril causes damage or loss to the home or insured property. Common perils include fire, hail, theft, and wind. However, explosion, aircraft-related damages, riots/civil commotion, vandalism/malicious mischief, theft, and volcanic eruption are also covered under HOA.

• The Texas Department of Insurance says that HOA policies provide cash value insurance coverage. That is, settlement offered for damaged property must be depreciated to consider the item’s condition and age when the loss occurred.

• No flood insurance may be obtained through FEMA or National Flood Insurance Program (NFIP).

2. In comparison, HOA+ is comparable to HO2 policies in many other states. HOA+ also lists the specific perils covered but includes an additional six perils, including falling objects, ice/snow/sleet weight, freezing, overflow/accidental discharge of steam or water, sudden/accidental tearing/cracking/burning/bulging, or sudden/accidental damage from “artificially-generated electric currents.”

• These policies allow the consideration of damaged items’ replacement cost. This means a settlement offer is not affected by depreciation.

• No flood insurance (FEMA/NFIP) is available.

• Repairs necessitated by mold/fungi, including testing, remediation, or reimbursed living expenses, are limited.

3. HOB, Texas’ Basic Open Perils Policy, became available in June 2011. HOB is comparable to HO-3 insurance policies elsewhere. HOB insurance policies cover direct physical damage to property with outlined policy exceptions.

• HOB policies protect the Texas homeowner’s belongings from HOA+ identified perils with the important exclusion of water damage (with the exception of water damage that results from sudden/accidental discharge.

• In exchange for higher premiums, the HOB policy can endorse other water damage/coverage forms.

• Homeowners are ineligible for FEMA/NFIP flood insurance.

• Costs and repairs relating to mold or fungi damage and remediation may be covered. Review exclusions relating to mold and fungi.

4. HOC Texas homeowners insurance policies are comparable to HO-5 policies issued in other states. HOC policies are considered “comprehensive” and “open-peril” policies. By definition, the HOC policy protects the insured’s dwelling and contents from direct loss as outlined by the policy.

HOC policy premiums are frequently the most expensive because of their extensive coverage. The HOC policy is typically similar to the HOB policy in terms of water coverage, but there are differences according to the area in which the homeowner lives.

• Replacement cost is allowed.

• Costs and related repairs from mold or fungi damage or certain deterioration issues may be covered by the HOC policy.


Understanding more about the type of Texas homeowner insurance coverage offered can help the insured to better compare premium costs. Ask questions about the Texas homeowner insurance policy before committing to purchase. For instance, replacement cost vs. actual cash value claims settlement can yield vastly different recovery results.