Lubbock, TX · Member since 2017 · 9 posts · 3 votes
I'm a new investor currently in the process of analyzing deals in my area (Texas). For the other investors in Texas, what is the average price range for insurance on a rental property?
Hi Brandon! Wreck'em!! Unfortunately, it is tough to voice an average. Premiums change by the zip code. It is a safe bet to say between $100-$200 monthly. My advice is to find an investor-focused insurance broker that can shop the market and find the balance between cash flow and asset protection.
Hi Brandon! Wreck'em!! Unfortunately, it is tough to voice an average. Premiums change by the zip code. It is a safe bet to say between $100-$200 monthly. My advice is to find an investor-focused insurance broker that can shop the market and find the balance between cash flow and asset protection.
As Cameron mentioned above, it's tough to state an average, especially in Texas. Texas experiences just about every peril under the sun and more specifically over 600 separate wind/hail storms annually. If you're specifically looking in the Lubbock (or West Texas) area, I think you'll see those rates out there inching upward if they haven't already. Just within the last few months they've had some significant wind/hail storms. Most of Texas is prone to significant wind/hail, but that area has been hit pretty hard in recent months and certainly in years past. Mix that with a tough economy and a hardening insurance market, and rates will likely take a more significant increase in your area.
Please understand that rates change every year, and vary from carrier to carrier. That said, based on what I've seen across the state (at this current moment), I think you could safely use .60 cents for property in the "non-tier" counties, and $80 per dwelling for liability. If you're looking in the Austin and San Antonio areas, those rates may be a little less due to that area being much less prone to major wind/hail events. However, if you're looking down along the Gulf Coast, then I'd suggest using much higher rates (in the .75 to 1.10 range). If you're looking at a rental within 40 miles of the coast, you should probably assume the higher rate. If you're 41-70 miles from the coast, you should probably assume the lower rate. Anything further than 70 miles from the coast will have lower rates.
Examples using a $150,000 replacement cost value:
Heavy wind/hail areas of Texas (Dallas, Ft. Worth, and West Texas Counties) - $150,000 x .0060 = $900 + $80 = $980 (+ $100 for taxes & fees) = $1,080
Austin & San Antonio counties/area - $150,000 x .0050 = $750 + $80 = $830 (+ $100 for taxes & fees) = $930
Tier 2 - $150,000 x .0075 = $1,125 (+ $100 for taxes & fees) =$1,225
Tier 1 - $150,000 x .0110 = $1,650 (+ $100 for taxes & fees) = $1,750
Great advice from Bo and Cameron- it will definitely depend where you're looking and what sort of coverage you want. If it helps to know a specific figure, we pay ~$1300/year for a 1500sqft property in Temple, TX, built in 2008. We are with Traveler's.