TWIA Submits 5% Rate Increase Filing and Other Filings to Texas Department of Insurance

The Texas Windstorm Insurance Association has made several filings with the Texas Department of Insurance (TDI). The filings have been made at the direction of TWIA’s Board of Directors at its meeting of August 3, 2021.

It is expected that these filings will be posted to TDI’s TWIA Filings webpage.

Rate Filing

TWIA is required by statute to make an annual rate filing by August 15 each year. The filing submitted by TWIA staff on August 6 includes a rate increase of 5% for residential and commercial policies. The filing, which was approved by a vote of 5 to 3 of the Board, may be subject to review by TDI in some circumstances. The new rates are expected to go into effect for policies issued or renewed starting January 1, 2022.

Maximum Limits of Liability

State law requires the Association to submit a filing related to TWIA’s maximum limits of liability by September 30 of each year. TWIA staff submitted this filing on August 6. The limits establish the maximum amount of coverage a policyholder can purchase from TWIA. This filing does NOT impact TWIA’s rates and is benchmarked as required by law to match publicly available construction cost index information. The proposed limits are as follows:

  • Dwellings and individually owned townhouses: $2,037,000
  • Manufactured homes: $96,600
  • Contents of an apartment, condominium, or townhouse: $426,000
  • Commercial structures and related content: $4,927,000

Rate Manual

The Board directed staff to file a proposed update to the Association’s Rate Manual for TDI approval. The Rate Manual outlines the rules and rates for TWIA policies and requires the approval of the Insurance Commissioner. The Rate Manual was last updated in 2012.

While the proposed changes to the Rate Manual may be considered a rate filing by TDI, it will NOT result in an overall increase in TWIA rates. TWIA staff submitted the Rate Manual filing on August 6.

Proposed updates to the Rate Manual include:

  • Overall formatting and structure. The current Rate Manual contains outdated references and a combination of underwriting and rating guidelines. Underwriting and rating guidelines are now required to be filed under separate categories with TDI.
  • Updates to business processes. The current Rate Manual contains outdated business processes. Changes reflect the most up-to-date procedures and practices at TWIA.
  • Updates to rate-related information. Outdated rate tables and related rating information throughout the manual have been replaced with the rates most recently approved by TDI. No new or modified rates are being introduced in the Rate Manual.