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Texas Department of Insurance
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FAQ: Homeowners insurance, claims, saving money, and more


Also read our answers to common questions about homeowners insurance policies and filing claims due to a disaster.

Do I have to buy home insurance?

If you have a loan on your house, your mortgage company will require you to have insurance. After your loan is paid off, you can decide whether to keep the insurance. But think about the cost of building a new house and replacing everything you own without insurance.

Will my home insurance cover any kind of damage?

Your policy will pay for the kinds of losses listed in your policy, including fire, lightning, explosion, vandalism, and windstorm (if you don’t live on the coast). It also pays to replace your personal property (the things you own inside the house) if it’s stolen or damaged. It won’t pay for flooding, earthquakes, termite damage, or wear and tear. You can buy separate flood and earthquake policies.

Learn more: Home insurance policies: All risk or named peril

Does homeowners insurance cover water or mold damage?

Most homeowner and renters policies cover sudden and accidental water damage. Examples would include a burst pipe, toilet overflow, or broken washer hose. If mold develops on a damaged item, it would be covered. Policies usually won’t cover damage from gradual leaks.

Mold from a flood would not be covered because home policies don’t cover floods. You would need a separate flood policy.

Learn more: Is water damage covered by home insurance? (video)

Does homeowners insurance cover termite or squirrel damage?

No. If rodents and insects chew on your house, your policy won’t pay for the repairs. Inspect your house, roof, and attic to look for any holes you can patch.

Will insurance completely replace my house and property if they’re destroyed?

It depends. You and your insurance company will decide how much insurance you want to buy. The policy will pay up to that amount for whatever damages you have. You’ll also have to pay a deductible if you have a claim. It’s a good idea to review your coverage every year to make sure you have enough insurance to pay for your house and other things you own.

Learn more: Do I have enough home insurance?

Will my home insurance pay doctor bills if someone is hurt in my house?

Yes. Your policy has “liability coverage” that pays if someone from outside your household is hurt. It also pays for legal fees if the person sues you. But it’s important to tell your insurance company if you rent through a home sharing service or if you have a high risk, like a swimming pool, trampoline, or an aggressive dog.

How can I reduce my monthly premium?

You can switch to a higher deductible, ask your agents if there are any discounts you’re not getting, or shop around for a new company with lower rates. Ask several companies for rates, but make sure you get the coverages you need.

As for deductibles, switching from a $500 deductible to a $1,000 deductible can save as much as 20% on your insurance premium. But remember that a higher deductible means you might have to pay more out-of-pocket if you have a claim. When deciding what deductible is right for you, think about how much you can afford to pay if your house is damaged.

Learn more: How to shop smart for insurance.

Will I get a refund if I cancel my homeowners insurance policy early?

Yes. If either you or the company cancels your policy, the company must give you a refund for the remaining months. So if you paid a full year of premiums and you cancel after one month, you’ll get 11 months’ worth of premiums back.

The power went out in my area and the food in my refrigerator spoiled. Will my home policy pay for the food?

Most policies will pay up to $500 for food that spoiled because of a power failure caused by something your policy covers. Ask your agent or look in your policy to see the exact amount that it pays.

What is mortgage insurance?

Mortgage insurance protects your lender – not you – if you can no longer pay for your home loan. Most lenders will require it if you put less than 20% down for your house. Mortgage insurance doesn’t pay to repair or replace your house.

Questions? Call us at 800-252-3439.

Last updated: 4/18/2023