Many North Texans are worried about the increasing cost of home insurance, wondering if they’ll be able to afford to stay in their homes. The issue has prompted numerous complaints to NBC 5 and calls for state lawmakers to take action. Home insurance is a regional market, meaning that more people living in disaster-prone areas drives up prices for everyone. The cost of labor and materials to repair homes has also increased with inflation, creating a perfect storm since 2020.
State lawmakers will debate a proposed solution this spring: requiring insurance companies to get approval from the Texas Department of Insurance before raising premiums by 10% or more. This ‘prior approval’ system was used about twenty years ago before Texas switched to a ‘file and use’ system. Currently, insurance companies can raise rates unless regulators later deem the increase unnecessary.
The Proposed Legislation
Senate Bill 1643, authored by Senator Charles Schwertner (R-Georgetown), has already passed the Texas Senate. The bill aims to prevent insurance companies from implementing significant rate hikes without proper oversight. According to Schwertner, companies are currently able to raise rates by 20 or 30% without immediate regulatory intervention.
The NBC 5 investigative team found that insurance companies have filed numerous double-digit premium increases in recent years: 362 in 2023, 293 in 2024, and 108 so far in 2025. While the number of large increases is trending downward, lawmakers remain concerned about the impact on homeowners.
Industry Response
Insurance industry representatives argue that it’s not company profits driving the increases, but larger market forces such as more expensive homes in disaster-prone areas. Beaman Floyd of the Texas Coalition for Affordable Insurance Solutions warns that adding another regulatory step could drive companies out of the market, reducing options for consumers and potentially increasing costs.
Critics also point out that SB 1643 won’t completely solve the problem since companies can still raise rates by up to 9% without approval. A separate bill proposing a 5% threshold doesn’t appear to have bipartisan support. With the legislative session ending on June 2nd, experts say that while new regulations might slow price growth, they’re unlikely to cause prices to drop drastically.
Historical Context
Since 1980, Texas has experienced $179 billion in weather-related events. Homeowner premiums have risen by 50% since 2015, and the number of double-digit rate increases has grown by 560% since 2014. Lawmakers face the challenge of balancing consumer protection with the need to maintain a viable insurance market in the state.
