Homeowners insurance premiums in Texas rose 30% between 2019 and 2024, roughly 10 times faster than the state’s 3% income growth over the same period, according to a new report from Rice University’s Kinder Institute for Urban Research and the public policy group Texas 2036, as reported by Realtor.com.
The average Texas homeowners insurance policy now costs $2,983 a year. Zooming out further, the report found premiums climbed 74% between 2009 and 2024, while median household income in the state rose just 11% over that same 15-year span.
The result: Texas households in the median county now spend about 4.7% of household income on homeowners insurance, up from 2.9% in 2009 β and the burden falls hardest on lower-income households.
Nearly two-thirds of Texas households priced out
The Kinder Institute report estimates roughly 7 million Texas households β nearly two-thirds of the state β would be considered housing cost-burdened if they purchased the median-priced home in their county, once insurance costs are factored in alongside a mortgage payment. A household is considered cost-burdened when housing costs, including insurance, exceed 30% of income.
The report projects the problem could worsen. An average annual 4% premium increase would price out an additional 20,077 Texas households from their county’s median-priced home, the Kinder Institute found, while a 10% increase would price out an additional 49,896 households. Those increases aren’t hypothetical: insurers raised Texas premiums by 10% or more 108 separate times in 2025 alone, according to Realtor.com’s report citing NBC affiliate KSAT-TV.
Wind, hail and rising home values drive costs
Texas’ exposure to tornadoes, hail, coastal flooding and hurricanes is a central driver of the increases. The Texas Department of Insurance told Realtor.com that insurers paid $8.74 billion in losses in 2025 from wind and hail, water, fire, theft, liability and vandalism combined β with wind and hail alone accounting for an average of 62% of homeowner losses since 2019.
Rising home values have compounded the trend: the average insured coverage amount climbed 50%, from $294,900 in 2020 to $443,000 in 2025, as insurers adjust replacement-cost coverage upward alongside home prices.
“Affordability has become a real concern, especially for homeowners who have paid off their mortgage and are no longer required by a lender to carry insurance,” Jessica McNally, a licensed insurance agent with Goosehead Insurance in Dallas, told Realtor.com. McNally said some homeowners are going without coverage entirely, while others are raising deductibles or switching from replacement-cost to actual-cash-value coverage to lower premiums β a trade-off, she cautioned, that “can create a much larger financial problem after a major loss.”
What it means
Verified facts: The Kinder Institute/Texas 2036 report documents a 30% five-year and 74% fifteen-year rise in Texas homeowners insurance premiums against much smaller income gains, with state insurance regulators confirming both the scale of 2025 rate increases and the rise in average coverage amounts.
RealtyWire analysis: Texas is emerging alongside Florida as a bellwether for how climate-driven insurance costs are reshaping housing affordability independent of mortgage rates or home prices β a dynamic that increasingly matters to agents and lenders underwriting deals in disaster-exposed states, since a policy’s premium can now swing a buyer’s qualifying payment as much as an interest-rate move.
Texas lawmakers have responded with a proposed “prior approval” requirement that would force insurers to get state sign-off before implementing double-digit premium hikes β current law lets carriers raise rates without approval unless regulators object. Whether that measure advances could shape how much further the state’s affordability squeeze deepens.
What to watch
Roughly 1.1 million Texas homeowners were already without home insurance as of 2022 Census Bureau data, about 9.5% of homeowners statewide β a figure likely to be tested further if the “prior approval” legislation stalls and premium increases continue at their recent pace.
