Hurricane Beryl, the first hurricane to hit Texas this year, caused billions in insured losses, and the resulting claims are already driving rate increases across the state.
The record-setting Category 5 hurricane swept through southeast Texas in early July, causing catastrophic flooding and severe wind damage. The Texas Windstorm Insurance Association (TWIA) voted to file for a 10% rate increase on policies to begin in 2025, though a 2024 analysis recommended at least a 38% increase for residential policies to be actuarially sound.
The TWIA has increased rates by only 0% or 5% every year since 2011 to be “mindful of insurance costs on policyholders.” But those small increases aren’t enough to catch up to current losses.
What Beryl will cost
Insured losses following Hurricane Beryl will fall between $2.5 billion and $4.5 billion, according to Moody’s RMS Event Response.
“Hurricane Beryl was yet another complex and impactful event across multiple fronts and regions,” Jeff Waters, Moody’s North Atlantic hurricane models director, said in a report on the storm’s impact. “Texas building codes — while not as stringent as other states — should allow most structures to withstand the winds reported from Beryl, but with the region’s high exposure density, significant amounts of expected minor/moderate damage will contribute to the overall total insured losses.”
Economic losses are even higher, according to a report from economic analysis agency The Perryman Group. It forecasts losses could reach $4.6 billion in Texas alone and $7 billion nationwide.
“In addition to the enormous human costs, Hurricane Beryl will have a significant net negative impact on the economy,” the report read. “However, the area will recover over time and likely resume its prior pattern of expansion in the future.”
Many Texans have to supplement their home insurance with wind or flood insurance to completely insure their homes, and those losses hit insurers hard. The state’s public wind insurer, TWIA, received more than 27,000 claims and paid out 10,000 claims amounting to $120 million by early August, Reinsurance News reported. The TWIA team told Reinsurance News claims from Beryl will use a substantial portion, if not all, of its $450 million catastrophe reserves.
Storms drive high insurance rates
The photos and videos of flooded highways and battered homes show how the storm affected structures and infrastructure, but they can’t depict the lasting costs of severe weather.
Texas has the fourth-highest home insurance rates in the country, behind Florida, Louisiana, and Oklahoma, according to Insurify’s home insurance report. The average annual home insurance premium in Texas is $4,456 for $300,000 of dwelling coverage, well above the national average of $2,377, per Insurify data.
The states with the highest home insurance rates are prone to severe weather, and Texas’ large area makes it vulnerable to many events. Texas faces hurricane, wildfire, and tornado risk at different levels throughout the state, according to Insurify analysis.
What’s next: Helping residents recover
The Texas Department of Insurance shared tips for residents following Hurricane Beryl on how to file an insurance claim, assess flood damage, and avoid contractor scams.
“You need to get your claim started as soon as possible,” said Insurance Commissioner Cassie Brown. “We can help you if you run into an issue contacting your insurance company or just don’t understand what you’re hearing from them.”
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