Wednesday May 20, 2026
What is Texas condo insurance?
Texas condo insurance is offered for both the condominium association (the “master policy”) and individual unit owners (the “HO-6” policy).Master insurance policies
This master policy is designed to insure the building itself, shared systems, and certain liabilities, forming the foundation of the community’s overall risk protection.Under the Texas Uniform Condominium Act, the association is required to carry property insurance and commercial general liability insurance that protects the condo’s common elements.
In buildings with units that have horizontal boundaries (like the classic stacked condo or high-rise apartment-style unit), the property insurance must also cover the units, to the extent reasonably available. However, the association is not required to insure improvements and betterments installed by unit owners.
HO-6 policies
Unit owners often carry their own condominium insurance to cover personal property, interior finishes (depending on the master policy type), personal liability, and additional living expenses after a covered loss.Condo association insurance coverage types in Texas
Your association’s program is usually a bundle of different insurance coverage types, often including:- Property insurance for the building structure and shared areas
- General liability coverage for injuries or property damage occurring on common property
- Directors and officers liability coverage to support the board when governance decisions result in covered claims
- Fidelity or crime coverage to protect association funds
- Umbrella liability to increase limits beyond certain base policies
- Equipment breakdown coverage for systems such as elevators, boilers, or pumps
- Building ordinance and law coverage to address reconstruction costs required by updated codes
- Flood or windstorm-related coverage, which may be required in coastal zones or recommended by the broker
All-in vs. bare walls coverage
In Texas condominiums, the master policy typically follows either an “all-in” or “bare walls” structure.An all-in policy generally covers the building structure plus original fixtures and standard finishes inside units, such as cabinets, flooring, and built-in features.
A bare walls policy usually covers only the structure and common elements, stopping at the unfinished interior surfaces of the unit walls. In that case, owners must insure most interior components and upgrades.
Costs for boards
In Texas, master policy premiums often range from $1,000 to $2,500+ per unit annually, depending on risk factors such as wind and hail exposure. Coastal and hail-prone areas typically see higher rates and higher deductibles.Condo insurance rules of thumb for board members
When evaluating Texas condo insurance, board members should keep these practical guidelines in mind:- Confirm the master policy meets the minimum 80% replacement cost or actual cash value requirement, to the extent reasonably available, under Texas law (Texas Property Code § 82.111).
- Review insured values annually to account for rising construction costs.
- Understand wind and hail deductibles, especially percentage-based deductibles common in Texas.
- Maintain adequate Directors & Officers (D&O) and general liability limits.
- Confirm that fidelity/crime coverage protects association funds.
- Communicate clearly to owners what the master policy does and does not cover.
- Coordinate insurance reviews with reserve studies and major capital projects.
Expert insights from FirstService Residential
VP of Insurance at FirstService Financial, Jamie George, sat down with High-Rise General Manager at FirstService Residential, Shawn Bell, to address common concerns about rising Texas condo insurance rates. Jamie shares her insider take on how trends among carriers have shifted over the years and what it means for your association.The good news: Your association can mitigate rising Texas condo insurance rates while obtaining proper coverage.
Learn more in the video below:
Highlights from the video and more:
Why have Texas condo insurance annual premiums increased so much?
Following the recovery efforts from Hurricane Harvey, 2017 and 2018 were two of the largest payout years in insurance history. The worldwide impact is a major reason we see insurance rates increase so much. Even if you do not live in a hurricane zone, your premiums are still affected because carriers now look at them on a global basis.Another reason for rising insurance rates is inflation. Costs of goods and labor have spiked over the last few years, which also drives up the price of premiums.
How often should condo associations get appraisals?
Due to current market conditions, it’s best to get an appraisal every 24 months. It’s important to know both the total value and total insurable value of your condo. Carriers look very closely at these values to confirm that they align.Can COAs get a discount on policy premiums if they install more safety features in their buildings?
Installing more safety features may not translate into a discount on your Texas condo insurance, but it may cut costs in the long run. For example, incorporating technology that decreases water loss will be favored by carriers because they will see the difference in the loss history and claim history. The building will benefit from this because COAs can devote more deductible money toward prevention efforts."[When I was a high-rise general manager], we rolled out a product that wirelessly monitors up to 600 points throughout the building. If any sensor detects any moisture, it sends out a text blast and an email to the manager and front desk, [which had] a response team ready.
When we were renewing insurance at that property, [the carrier] was glowing, seeing that in action in a live test we performed. I don’t know if that translated into any favorable drops in our premiums there, but at least they liked what they were seeing."
Shawn Bell, High-Rise General Manager
High-rises tend to have more luxurious finishes. How can COAs confirm that the valuations are accurate?
Partner with a broker who has expertise in high-rise buildings and is well-informed on rising Texas condo insurance rates. He/she should practice due diligence, thoroughly studying your association’s documentation.Go on site walks with your broker. To obtain proper coverage, point out unique finishes like artwork. For example, a painting on a lobby wall may be worth more than the standard limitation on an insurance policy. He/she should already be catching these things, but confirming you’re on the same page never hurts.
What are the limitations of umbrella insurance?
As a rule of thumb, umbrella insurance does not always equal true “umbrella” coverage anymore. It is more of an excess liability insurance. This can be a pain point for associations — policies no longer offer the broader coverage we used to see in a typical umbrella market.Umbrella policies have drastically changed because of the influx of claims carriers have received on the liability side (third party), not the property side (first party). This includes slip-and-falls, injuries, and similar cases that have increased attorney involvement. Unfortunately, this leads to higher payouts in defense or settlement costs.
Just a few years ago, associations experienced a much easier umbrella market. COAs could obtain a $100 million umbrella policy for an affordable rate. Today, they are lucky to find a reasonable $25 million policy.
Still have questions about Texas condo insurance for your association?
To learn more about handling changes in your premiums, contact FirstService Residential today.This information is provided for general informational purposes only and is not intended to constitute, and should not be relied upon as, legal, regulatory, financial, or operational advice, or as a representation or guarantee of any specific services, capabilities, or outcomes. Property management needs, regulatory requirements, market conditions, and available services vary by jurisdiction, property type, and community. FirstService Residential provides services through locally based affiliates and associates, and services and results may vary by community, region, contractual terms, and applicable law.