TWIA vs. the Texas FAIR Plan: What Each Covers and How They Pair
Two last-resort programs split Texas home insurance by peril and by place. Here is what each one covers, who qualifies, what counts as a declination, and when you need both.
What is the difference between TWIA and the Texas FAIR Plan?
TWIA covers windstorm and hail only, in the 14 first-tier coastal counties and parts of Harris County east of Highway 146. The Texas FAIR Plan writes limited property coverage across Texas but can’t write wind and hail where TWIA does. TWIA needs one private-market declination; the Texas FAIR Plan needs two. On the coast you may need both policies.
Wind and hail, or everything else
Texas has two insurers of last resort for homes, and they split the risks between them. The Texas Windstorm Insurance Association (TWIA) writes windstorm and hail coverage only, and only on the coast. The Texas FAIR Plan Association (TFPA) writes limited property coverage across Texas, but by law it can’t write wind and hail where TWIA does.
TWIA says its eligibility rules are set by the Texas Legislature in Texas Insurance Code Chapter 2210. TFPA calls itself a residual market carrier that provides limited coverage, and says it does not compete with the private market. Both are last resorts: each requires proof that private insurers have turned you down.
TWIA and the Texas FAIR Plan compared
| TWIA | Texas FAIR Plan (TFPA) | |
|---|---|---|
| What it covers | Windstorm and hail only, for dwellings, personal property, manufactured homes, commercial property and some miscellaneous items such as fences and pools | Limited property coverage through Homeowners, Dwelling, Condominium and Tenant policies; no wind and hail in TWIA’s area |
| Where | The 14 first-tier coastal counties and parts of Harris County east of Highway 146 | Throughout Texas |
| Declinations needed | At least one, from an authorized insurer actively writing or renewing wind and hail in the coastal area; a new one every three calendar years for renewal | At least two, from companies licensed to write and actually writing property insurance in Texas |
| Other key rules | A windstorm certificate of compliance (WPI-8, WPI-8-E or WPI-8-C), with limited exceptions; flood insurance proof for some V-zone homes; insurable condition | No current policy, renewal offer or valid offer of comparable coverage; reapply in the voluntary market every two years |
| How to apply | Through a licensed agent, who keeps proof of the declination | Only through a licensed property and casualty agent; TFPA doesn’t sell direct |
Who qualifies for TWIA
TWIA lists these requirements to obtain or keep its windstorm and hail coverage:
- The property is in the area designated by the Commissioner of Insurance: Aransas, Brazoria, Calhoun, Cameron, Chambers, Galveston, Jefferson, Kenedy, Kleberg, Matagorda, Nueces, Refugio, San Patricio and Willacy counties, plus parts of Harris County east of Highway 146.
- You were denied coverage by at least one authorized insurer actively writing or renewing windstorm and hail coverage in that area.
- The property is certified as built to applicable building codes (WPI-8 or WPI-8-E from the Texas Department of Insurance, or WPI-8-C from TWIA), with limited exceptions. Windstorm certificates explained →
- In flood zones V, VE or V1-30, a property built, altered, remodeled or enlarged on or after September 1, 2009 that can get National Flood Insurance Program coverage must show proof of flood insurance.
- The structure is kept insurable: in good repair, with no unrepaired damage or hazardous conditions. TWIA says it inspects properties, in person or with aerial imagery.
What counts as a TWIA declination
Under TWIA’s declination rules, the insurer must be authorized to sell property insurance in Texas (surplus lines companies don’t qualify) and must be offering wind and hail coverage in the first-tier coastal counties. A declination is either a refusal to offer or renew wind and hail coverage, or an offer that is more restrictive than TWIA’s, such as only a higher deductible or no replacement cost coverage. Proof records the insurer’s name and the date, and your agent keeps it for at least five years. TWIA also notes that a windstorm and hail exclusion endorsement on your policy may be read as your own choice to exclude the coverage, not as a declination.
Who qualifies for the Texas FAIR Plan
TFPA’s statutory rules: you must have been denied coverage by at least two insurance companies licensed to write and actually writing property insurance in Texas. You are not eligible if you have a current homeowners or other property policy, a renewal offer, or a valid offer of comparable coverage from a Texas-licensed insurer. Policyholders must reapply in the voluntary market every two years.
TFPA also applies underwriting rules. It lists these reasons it may deny an application: a condemned property; disrepair or existing damage; a vacant property; excessive or unusual liability exposure, such as a dangerous animal or an unfenced pool or trampoline; an applicant convicted of arson, fraud or another insurance-related offense; more than eight paid claims, not counting glass claims, in the past three years; a mobile home, unless the wheels are removed and it is tied down; a farm or ranch used for business; or a dwelling occupied for business use.
What a TFPA policy covers
Per TFPA’s coverage summary, dwelling and personal property are covered at actual cash value; the Homeowners Policy can be endorsed for replacement cost if you insure the dwelling for 100% of its replacement cost, and TFPA may pay only part of a loss if you are insured for less than 80%. The Dwelling Policy covers fire and lightning, with the other perils, including windstorm and hail where allowed, available as optional extended coverage. Limits include dwelling coverage up to $1,000,000, other structures at 10% of the dwelling amount, and liability of $100,000 or $300,000 on the Homeowners, Condominium and Tenant policies.
TFPA lists perils it does not cover, including falling trees or objects, collapse, glass breakage, the weight of ice, snow or sleet, freezing of plumbing or appliances, mold remediation, sewer or drain backup, and items that are usually scheduled, such as expensive jewelry. Sudden and accidental discharge of water or steam is available only as a limited endorsement, for an extra premium, on the Homeowners, Tenant and Condominium policies.
On the coast, you may need both
TFPA says it is not authorized to provide windstorm and hail insurance for properties eligible for TWIA coverage, and that if you live in TWIA’s area and qualify for TFPA, you may have to carry both policies.
- Inside TWIA’s area: TWIA for wind and hail, and either a private insurer or TFPA for the rest. A TFPA policy written there must carry a Windstorm and Hail Exclusion Agreement.
- Outside TWIA’s area: TWIA isn’t available, and a TFPA policy can include windstorm and hail.
- The declinations differ: TWIA needs one, for wind and hail; TFPA needs two. Ask your agent to collect them in the same round of calls so the two applications move together.
- Watch the timing: TWIA wants a fresh declination every three calendar years; TFPA wants you to reapply in the voluntary market every two years.
TWIA coverage, limits and cost → · The Texas FAIR Plan in detail → · Estimate a TFPA premium →
TWIA and Texas FAIR Plan questions
Does the Texas FAIR Plan cover wind and hail?
Outside TWIA’s coastal area, a TFPA policy can include windstorm and hail. Inside it, TFPA says it is not authorized to provide wind and hail coverage for properties eligible for TWIA, and its policies there carry a Windstorm and Hail Exclusion Agreement, so TWIA covers those perils.
How many declinations do I need for TWIA and for the Texas FAIR Plan?
TWIA needs at least one declination from an authorized insurer writing wind and hail in the coastal area, renewed every three calendar years. TFPA needs at least two, from companies licensed to write and actually writing property insurance in Texas.
Do surplus lines insurers count as a declination?
Not for TWIA: its rules say surplus lines companies do not qualify. TFPA requires denials from companies licensed to write and actually writing property insurance in Texas.
Can I buy TWIA or Texas FAIR Plan coverage directly?
Not the Texas FAIR Plan: TFPA says it does not sell policies directly and accepts applications only through a licensed property and casualty agent. For TWIA, its rules describe an agent submitting the application and keeping the proof of declination, so start with a licensed Texas agent.