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Real property

homeowner's insurance

Homeowners insurance protects against damage to your home and belongings (furniture, appliances, clothing, jewelry) from hazards such as:

• Fire and smoke

• Windstorm or hail

• Theft

• Falling objects (trees, power lines)

• Frozen plumbing

• Water damage caused by plumbing, water heater, appliances, and heating and cooling systems

• Vandalism

Your homeowners policy may also protect you against claims you are liable for someone else injuries or property damage—such as if your dog bites a guest at your home—and may cover you for claims that occur away from your home, such as if your dog bites someone at the dog park.

Some homeowners policies may provide other structures coverage to repair or replace structures on your property that are not attached to your house—such as a garage, shed, or fence.

Your homeowners policy may provide loss of use coverage and pay your additional living expenses (rent, food) if you have to move out of your house while it is being repaired, for example.

You may need a special provision in your homeowners policy (an endorsement) to insure against the loss of expensive jewelry such as engagement and wedding rings, watches, diamond bracelets, etc.

In Texas, homeowners insurance typically covers damage to the home and personal belongings due to a variety of hazards, including fire, smoke, windstorms, hail, theft, falling objects, frozen plumbing, and water damage from household systems. It also often includes liability coverage for injuries or property damage that the homeowner may be responsible for, such as dog bites, whether these occur at home or elsewhere. Coverage for other structures on the property, like garages and fences, is usually part of a standard policy. Additionally, loss of use coverage is common, which helps with living expenses if the home is uninhabitable during repairs. For high-value items like expensive jewelry, a special endorsement may be required to ensure adequate coverage. It's important to review the specific terms and limits of a policy, as coverage can vary. Texas homeowners should consult with an attorney or insurance agent to understand their policy and ensure they have the appropriate level of protection.


Texas Statutes & Rules

Federal Statutes & Rules

McCarran-Ferguson Act (15 U.S.C. §§ 1011-1015)
This federal statute is relevant because it provides that states have the authority to regulate the business of insurance without interference from federal regulation, unless federal law specifically provides otherwise.

The McCarran-Ferguson Act, passed in 1945, declares that states should regulate the insurance industry while the federal government has the authority to regulate interstate commerce. Under this act, federal law will not preempt state insurance regulations unless the federal law specifically relates to the business of insurance. This means that while homeowners insurance is primarily regulated by state law, federal law can apply in certain circumstances, such as when there is a significant interstate or international component to the insurance issue.

Flood Disaster Protection Act of 1973 (42 U.S.C. §§ 4001-4129)
This statute is relevant to homeowners insurance as it pertains to the requirement for flood insurance in certain areas and the role of the federal government in providing flood insurance.

The Flood Disaster Protection Act of 1973 requires that property owners in flood-prone areas purchase flood insurance as a condition for receiving any form of direct or indirect federal financial assistance for acquisition or construction purposes. This act led to the creation of the National Flood Insurance Program (NFIP), which provides flood insurance to homeowners, renters, and business owners if their community participates in the NFIP. Homeowners insurance policies typically do not cover flood damage; therefore, this federal program is crucial for homeowners in flood-prone areas.

Homeowner Flood Insurance Affordability Act of 2014
This act is relevant as it amends the National Flood Insurance Act of 1968 and the Flood Disaster Protection Act of 1973, affecting the affordability of flood insurance, which is a separate policy from standard homeowners insurance.

The Homeowner Flood Insurance Affordability Act of 2014 was enacted to address the concerns about the affordability of flood insurance after the Biggert-Waters Flood Insurance Reform Act of 2012 significantly increased premiums. This act modifies certain provisions of the Biggert-Waters Act, including the prevention of dramatic rate increases, the introduction of surcharges on all policyholders, and the refund of policyholders who overpaid premiums. It also allows for a greater range of mitigation activities that can be considered when determining flood insurance rates.

Fair Access to Insurance Requirements (FAIR) Plans (12 U.S.C. § 1749bbb)
FAIR Plans are relevant as they provide a safety net for homeowners who are unable to obtain insurance in the private market due to high risk, including risks from hazards such as fire and windstorms.

FAIR Plans were established in the late 1960s as a response to the inability of homeowners in certain areas to purchase insurance due to factors such as urban unrest and natural disasters. These plans are state-mandated and provide property insurance to individuals who cannot obtain it from private insurers because their property is considered high risk. Each state's FAIR Plan operates differently, but they generally offer basic fire insurance coverage, and some offer additional coverage for other perils such as windstorm or vandalism. FAIR Plans are typically considered insurers of last resort.