Protecting the Texas Coast


The Texas coast is a vital part of the state’s economy, and insurance, both residential and commercial, helps to keep the economy strong. The Texas coast faces unique weather risks in the form of costly hurricanes like Hurricane Harvey in 2017 and Hurricane Ike in 2008, as well as other severe weather like 2016’s severe hail storms that affected many coastal counties. Due to the risk of costly storms like these, coastal residents and businesses have options for wind and hurricane coverage.

For example, in addition to homeowners insurance, many homeowners in Texas coastal counties (called the “tier 1 counties”) may have a separate wind insurance policy, written through either a private insurance company or through the Texas Windstorm Insurance Association (TWIA), which specifically addresses damage to a home caused by high winds normally associated with a hurricane.

TWIA - as the “insurer of last resort” - and the private market write insurance for coastal Texas residents. TWIA’s 2018 written premiums were $395 million. For the private market, 2018 written premiums for homeowners and dwelling policies were over $405 million.



Texas property and casualty insurers also write well over $500 million in commercial, residential, and auto coverage in tier 1 counties, making their total premiums written along the coast nearly ONE BILLION DOLLARS.

In addition, TWIA may assess insurance companies up to one billion dollars to help pay for TWIA policyholder losses after a storm. For example, to help pay for TWIA policyholder losses after Hurricane Harvey, TWIA assessed insurance companies $372 million dollars.


In 2016, TWIA paid over $250 million in hail storm losses. A similar (or bigger) storm or storms in 2020 would exhaust TWIA’s available funds in the Catastrophe Reserve Trust Fund (CRTF).


Only 30% of TWIA premiums goes to paying claims, and that amount could easily be exceeded with one storm. The other 70% goes to administrative costs, repaying debt from catastrophe bonds, agent commissions, and other expenses.


With the depletion of TWIA's CRTF funds after Hurricane Harvey in 2017, a heavy debt load from catastrophe bonds issued to pay claims, and a slow rebuild of the CRTF from policyholder premiums, TWIA faces important questions:

  • How will it build its reserves before the next storm hits?
  • What happens if a storm hits that exceeds their 1 in 100 year funding model?
  • What if a second storm hits in the same season?

For more information on hurricane season and how to stay prepared, visit our Hurricane Central resource page.

ICT member companies, click here for reports on TWIA meetings and legislation.


Additional ICT Resource Pages

Hurricane Central

Texas Floods

Costliest Texas Storms

What to do After a Loss