HOUSTON – Many residents in Texas have been left in limbo after their insurance company dropped them -- especially now during hurricane season.
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After Hurricane Beryl, thousands across Southeast Texas were left with damaged homes. Then some areas are still recovering from the derecho that hit the Houston area in May, knocking down large trees that toppled over homes, cars, and fences.
Finding homeowner’s insurance nowadays is a mess -- the industry is a mess within itself.
One of the reasons homeowner’s insurance is such a mess right now is because, after 2020, the average amount the insurance industry paid out each year has been $76 billion. But before 2020, the average payout was $30 billion a year.
Leash Yu, with Yu Insurance Agency, said one major storm this year could cause the market to collapse.
The Texas Department of Insurance says an insurance company can cancel your policy anytime if:
- The policyholder stops paying their premiums.
- The policyholder files a fraudulent claim.
- Continuing the policy violates the law.
- There’s an increase in risk within the policyholder’s control that would raise their premium.
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What if you were dropped by your insurance?
Insurance companies will give their customers a 60-day notice before their policy ends, which is the time to start looking for other reasonable options.
If you need help, the Texas Fair Plan Association is where you can find an insurance company when no other companies will take you. These plans are often very expensive, but it’s better than losing your entire home with no insurance coverage.
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What can you do if you can’t get home insurance coverage?
Leash Yu explains many of the lenders have what is called forced place insurance.
If you can’t find coverage here is what to do:
- Call your lender and tell them you can’t find insurance
- They will activate forced place insurance
- Only covers collateral on the house (belongings not covered, liability not covered)
- Very expensive
If your home was impacted and you’re uninsured -- your best bet would be to apply for FEMA to help with financial assistance.
Residents needing to register with FEMA can do so at www.disasterassistance.gov, by downloading the FEMA app, or by calling the FEMA Helpline. When registering, pay special attention to question 24 to note any disability-related losses or needs.