Personal Lines


Personal Lines Information

 

HOMEOWNERS INSURANCE

Most homeowners policies in Texas include the following coverage:

  • Dwelling pays if your house is damaged or destroyed by a covered loss.
  • Personal property pays if the items in your house (such as furniture, clothing, and appliances) are damaged, stolen, or destroyed.
  • Other structures pays to repair or rebuild structures not attached to your house, such as detached garages, storage sheds, and fences.
  • Loss of use pays your additional living expenses (housing, food, and other essential expenses) if you have to temporarily move because of damage to your house from a covered loss. Your policy will pay either a percentage of the amount of your dwelling coverage (typically 10 to 20 percent) or for a specific period after the loss (such as 24 months).
  • Personal liability pays to defend you in court against lawsuits and provides coverage if you are found legally responsible for someone else's injury or property damage.
  • Medical payments pays the medical bills of people hurt on your property. It might also pay for some injuries that happen away from your home, such as your dog biting someone at the park. A basic homeowners policy pays $500 in medical bills, but you may buy up to $5,000 in medical payments coverage.

Types of Homeowners Policies in Texas

Insurance companies in Texas may sell several types of policies. If a company offers you a policy with less coverage than you'd like, ask if other policies are available. You may also be able to buy additional coverage by adding endorsements to your policy.

Two types of policies sold in Texas are:

  • All-risk policies (also known as a comprehensive coverage or open perils coverage). These policies offer you broad protection and cover all causes of loss unless the policy specifically excludes them.
  • Named perils policies (also known as specified perils coverage). These policies offer narrower protection than an all-risk policy and cover only the causes of loss specifically named in the policy.

 

Policies typically provide replacement cost or actual cash value coverage:

  • Replacement cost is what you would pay to rebuild or repair your home, based on current construction costs. Replacement cost is different from market value and doesn't include the value of your land. Ask your insurance company if you aren't sure how much it would cost to rebuild your house.
  • Actual cash value is what you would pay to rebuild or replace your property minus depreciation. Depreciation is a decrease in value due to wear and tear or age. If your home is destroyed and you only have actual cash value coverage, the insurance company will not pay enough to completely rebuild your home.

 

Other Types of Residential Property Policies

  • Renters insurance (HO-4). A landlord's insurance doesn't cover a renter's personal property. Renters insurance covers your belongings, provides liability protection, and pays additional living expenses if a fire or other event covered by your policy forces you to move temporarily.
  • Condominium insurance (HO-6) Condominium insurance covers your belongings, provides liability protection, and pays additional living expenses. It also covers damage to improvements, additions, and alterations to the condo.
  • Townhouse insurance. Townhouses may be insured by either an individual homeowners policy or an association master policy. If a townhouse is owner-occupied and the townhouse association doesn't have a master policy on the building, you can purchase a homeowners policy on your individual unit. If the association has a master policy, you should get a Texas tenant homeowners policy to insure your personal property.
  • Mobilowners insurance. Mobile homes without wheels and resting on blocks or a permanent foundation may qualify for a homeowners policy. However, most mobile homes are insured by a mobilowners policy. A mobilowners policy is an auto policy that covers mobile homes used as residences. Mobilowners policies typically offer limited coverage.
  • Farm and ranch insurance. Farm and ranch owners policies insure homes outside city limits on land used for farming and raising livestock. You can pay extra to get coverage for certain farm equipment and outbuildings.

Flood Insurance

Homeowners policies typically don't cover damage caused by floods. To protect yourself from losses caused by floods, you’ll need to buy a separate flood insurance policy. If your property is in a special flood hazard area, your lender will require you to have flood insurance. A special flood hazard area has a 1 percent chance of being flooded in any given year. Even if your home is not in a flood hazard area, you should consider buying flood insurance.

Earthquake Insurance

Some insurance companies offer an endorsement to your policy that covers damages caused by earthquakes.

Extra Coverage (Endorsements)

If you want more coverage than the policy offers, you might be able to add an endorsement to your policy for a higher premium.

Some of the most common endorsements expand or increase coverage for jewelry, fine arts, or camera equipment. Other common endorsements provide coverage for damage originally excluded by the policy.

The following are common endorsements you can consider adding to your policy:

  • Backup of sewers or drains. Pays for damage caused by sewer or drain backup.
  • Damage to foundation or slabs. Pays to repair a foundation or slab up to certain limits.
  • Extended or additional dwelling replacement coverage. Pays up to a certain amount if your policy doesn't pay enough to rebuild your home.
  • Law or ordinance coverage. Pays if repair costs are higher because of local building codes or ordinances.
  • Mold remediation. Pays for mold remediation up to a certain amount.
  • Replacement cost-dwelling. Pays replacement cost after you repair or replace your property.
  • Replacement cost-personal property. Pays replacement cost after you repair or replace your property.
  • Water damage from a plumbing, heating, or air conditioning system. Pays for sudden and accidental water damage. Most policies don't provide coverage for continuous and repeated water damage.

Personal Umbrella Liability Insurance

If you want more liability coverage than a homeowners policy provides, you can buy a separate umbrella policy. Umbrella policies are generally available in limits of $1 Million, $2 Million, and $5 Million. For higher limits a more thorough application process is necessary so please contact us directly for a quote. 

Factors that Affect Your Premium

Insurance companies use a process called underwriting to decide whether to sell you a policy and what rate to charge you. Each company must file its underwriting guidelines with TDI and send us updates if the guidelines change. Companies use various factors to determine premiums. These include:

  • Your home's age and condition. Companies may refuse to insure homes in poor condition, but they may not deny coverage solely because of a home's age or value. However, most companies will charge you more if you are insuring an older house.
  • Your home's replacement cost. If you have a replacement cost policy, your policy will pay to rebuild your home if it's destroyed. Your premiums will increase in relation to the amount of your replacement cost.
  • Construction materials used in your home. Homes built primarily of brick are less expensive to insure than frame homes.
  • Where you live. Premiums will likely be higher in areas with a higher crime or high storm activity.
  • Availability of local fire protection. Premiums are usually lower for homes in areas with access to good fire protection.
  • Your claims history. Companies use your claims history to determine what to charge you for your coverage. Your claims history includes both the type and the number of claims filed.
  • Your credit score. Companies may consider your credit score when deciding whether to sell you a policy and what to charge you. However, a company can't refuse to sell you a policy or cancel or nonrenew your policy solely because of your credit score. Companies that use credit scoring must file their credit scoring models with TDI. It's a good idea to look at your credit report each year and correct any errors.

 

AUTOMOBILE INSURANCE

Many insurance companies use the Texas Personal Automobile Policy, a standardized policy form that offers eight types of coverages. Companies may sell other policies that the Texas Department of Insurance (TDI) has approved. Some of these policies have more limited coverage. The following summary can help you understand the eight basic auto coverages. Please note that your coverage may be different depending on the type of policy you buy. Contact us for a review of your policy if you aren't sure what coverage you have. 

1. Liability Coverage

What it pays: The following expenses, up to your policy's dollar limits, for the people in the other car involved in an accident that you or someone covered by your policy caused:

  • medical and funeral costs, lost wages, and compensation for pain and suffering;
  • car repair or replacement costs; and
  • car rental for the other driver while their car is being repaired.

Liability insurance also pays your defense costs, including attorney fees if someone sues you because of the accident. If you are arrested following an accident, liability insurance will pay up to $250 for bail.

Who it covers:

  • You and your family members. (Family members include anyone living in your home related to you by blood, marriage, or adoption. This includes your spouse, children, in-laws, adopted children, and foster children.)
  • Other people driving your car with your permission.
  • Family members attending school away from home.
  • Spouses living elsewhere during a separation.

You and your family members might be covered when driving someone else's car – including a rental car – but not a car that you don't own but have regular access to, such as a company car. Some policies provide only liability coverage when you drive a car you don’t own. Physical damage coverage for damage to the non-owned vehicle might not transfer. Ask your agent before renting a car or driving a car you don’t own or lease.

Some policies – called named driver policies – won't cover people who live with you, including family members, unless they're specifically named in the policy. For these policies, the declarations page must list the names of the people the policy covers.

2. Collision Coverage (for damage to your car)

If you still owe money on your car, your lender will require you to have collision coverage.

What it pays: If the insurance company decides your car can be fixed, it will pay you the cost of repairs. If the company totals your car, it will pay you the actual cash value of your car. Actual cash value is the current value of your car, minus depreciation. Whether the company decides to repair your car or total it, you’ll get only up to the dollar limits of your policy. Your policy’s dollar limits are shown on the declarations page of your policy.

Who it covers: You, your family members, and anyone else insured under your policy.

3. Comprehensive Coverage (other than collision)

If you still owe money on your car, your lender will require you to have comprehensive coverage.

What it pays: The cost of replacing or repairing your car if it’s stolen or damaged by fire, vandalism, hail, falling objects, or an event other than a collision. Your policy won't pay to replace a stolen car unless you report the theft to police and there is usually a 48 hour waiting period for theft claims to be settled. This allows time for the vehicle to be located. 

Payment is limited to your car's actual cash value, minus your deductible.

4. Medical Payments Coverage

What it pays: Medical and funeral bills resulting from an accident.

Who it covers: You, your family members, passengers in your car, and other injured people, including bicyclists and pedestrians, regardless of who caused the accident.

5. Personal Injury Protection (PIP) Coverage

What it pays: Similar to medical payments coverage, plus 80 percent of lost income and the cost of hiring a caregiver for an injured person.

Who it covers: You, your family members, and passengers in your car, and other injured people, regardless of who caused the accident.

Your insurance company will automatically give you PIP coverage, but you may reject it in writing if you don’t want it. The company must offer you $2,500 in PIP coverage, but you can buy more from most companies.

6. Uninsured/Underinsured Motorist (UM/UIM) Coverage

What it pays: Your expenses from an accident caused by an uninsured motorist, a motorist who did not have enough insurance, or a hit-and-run driver. Also pays for personal property that was damaged in your car.

There is a mandatory $250 deductible for property damage. This means you must pay the first $250 of the expenses yourself before the insurance company will pay.

There are two types of UM/UIM coverage:

  • Bodily injury UM/UIM pays for medical bills, lost wages, pain and suffering, disfigurement, and permanent or partial disability. There is not a deductible with this type.
  • Property damage UM/UIM pays for auto repairs, a rental car, and damage to items in your car.

Who it covers: You, your family members, passengers in your car, and others driving your car with your permission.

Insurance companies must offer UM/UIM coverage. If you don't want it, you must reject it in writing.

7. Towing and Labor Coverage

What it pays: Towing charges when your car can't be driven. Also pays labor charges, such as changing a flat tire or jump-starting your battery.

8. Rental Reimbursement Coverage

What it pays: A set daily amount for a rental car if your car is stolen or being repaired. Your company only pays for rental reimbursement if your car was damaged by something that your policy covers, such as fire or theft.

Factors that Affect Your Premium

Insurance companies use a process called underwriting to decide whether to sell you a policy and what rate to charge you. Companies must file their underwriting guidelines with TDI and update them each time they make a change. The factors companies typically use to set premiums include:

  • Your age and, for younger drivers, your marital status. Men under 25 and unmarried women under 21 have the highest rates.
  • Your driving record and claims history. A good driving record can save you money. Insurance companies will charge you more if you have accidents or tickets on your driving record. Companies may also charge more for major convictions like DWI/DUI, some driving violations, and accidents that cause injury. Some surcharges are mandatory and will apply to your premium for up to three years.
  • Where you keep your car. Rates are typically higher for people who live in cities because they have more accidents and auto thefts than people who live in rural areas.
  • Your car's type. Collision and comprehensive rates are highest for luxury, high-performance, and sports cars. Rates may also be higher for cars that damage easily or cost more to repair.
  • Your car's primary use. Your rates will be higher if you drive your car to and from work or for business.
  • Your credit score. Companies often use your credit score to decide if they want to sell you a policy and at what cost. A company can't refuse to sell you a policy, cancel, or nonrenew your policy based only on your credit. Quoting insurance does not affect your credit score and does not show up as a 'hit' on your credit. 
  • If you drove uninsured in Texas. Companies may charge more if you were without insurance for more than 30 consecutive days in the prior 6 months. This is referred to as a 'Lapse' in coverage. 

 

Other Personal Lines Coverage

 

Motorcycle/ATV, Boat/Watercraft, Recreational Vehicle/Travel Trailer and all other 'toys' can and should be insured. Getting a quote is easy and we just need some basic information. Fill out the form above, send us an email, call or stop by the office and we will be happy to assist you! 

 

 

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