Everything may be bigger in Texas, but that doesn’t mean Texans should overpay for homeowners insurance. The average cost of homeowners insurance in the Lone Star State is $4,456 per year for a policy with a $1,000 deductible and $300,000 in dwelling coverage — much higher than the national average of $2,377.

Texas homes are vulnerable to different natural disasters, including hurricanes, flooding, wildfires, and tornadoes, which makes it especially important for homeowners to have the right type of insurance coverage. Here’s what you need to know about comparing home insurance quotes and finding coverage in Texas.

Best home insurance companies in Texas

Texas has plenty of home insurance companies to choose from. The right home insurance for you will depend on your specific situation and insurance needs, so it’s a good idea to shop around and compare quotes.

The following are among the best homeowners insurance companies in Texas.

Cheapest rates: Farmers

Best insurer for bundling: Mercury

Best insurer for customer satisfaction: State Farm

Best insurer for online tools: Nationwide

Cheapest home insurance in Texas

The cheapest home insurance in Texas won’t be the same for every homeowner. That’s because different factors, like ZIP code, age of your home, claims history, credit record, types of coverage, and your chosen deductible, can all affect how much you pay. Additionally, each insurer uses a different formula for determining premium rates, so it pays to shop around.

In Texas, Farmers is the cheapest home insurance company, with an average annual premium of $2,167, or $181 per month, for $300,000 of dwelling coverage. Other inexpensive insurers in Texas include those in the table below.

Cost of homeowners insurance in Texas

Home insurance premiums in Texas cost an average of $4,456 per year for a policy with a $1,000 deductible and $300,000 in dwelling coverage. Although this isn’t the most expensive average cost for homeowners insurance in the nation, it’s among the highest premium prices in the country.

The relatively high cost of homeowners insurance in Texas is partially due to its location. The second-largest state in America experiences a variety of perils, including flooding, hurricanes, tropical storms, wildfires, and tornadoes, and these can cause devastating property damage.

But different factors can affect your premium costs in Texas, including the age of your home and its replacement cost, your area’s labor costs, your claims history, and your deductible amount.2

Cost of homeowners insurance by dwelling coverage amount

Dwelling coverage is the part of a home insurance policy that pays to repair or rebuild your home if it’s damaged in a covered event.

A common mistake homeowners make is assuming they should get dwelling coverage equal to their home’s purchase price. But repairing or rebuilding your home may cost more or less than what you paid for it, depending on the price of building supplies and labor, among other costs.3

For example, the average cost to rebuild a home in Texas ranges from around $220,000 in Wichita Falls up to nearly $750,000 in Missouri City.

That’s why it’s important to understand the cost of rebuilding your home so that you can get the right amount of dwelling coverage. The higher the coverage limits you choose for your dwelling coverage, the more you’ll pay in premiums. Rates shown in the table below are for Texas home insurance policies with a $1,000 deductible.

Cost of homeowners insurance by deductible

Your home insurance deductible is the amount of money you have to pay before your insurance kicks in. A low deductible means you pay less when you make a claim before the insurance policy covers the rest. But keeping a low deductible usually means paying higher premiums.

Raising your deductible lowers your premium amount, which can be an easy way to reduce your home insurance costs. Just make sure you don’t increase your deductible to an amount that you can’t afford if you make a claim.

Here’s how a deductible can change the annual premium of a Texas home insurance policy with $300,000 in dwelling coverage.

How to get cheap homeowners insurance in Texas

Texas homeowners can use different strategies to lower the cost of their homeowners insurance. Here are some of the most effective ways to save on home insurance policies:

• Bundle homeowners and auto insurance. Many insurers offer discounts to customers who purchase more than one type of policy with them. Choosing an insurance company that can handle both your home and auto insurance can save you money on both policies.

• Improve your home’s safety and disaster readiness. Insurance companies often offer discounts to homeowners who improve their home’s security with things like smoke detectors, burglar alarms, and deadbolts. Some homeowners even get discounts when they invest in disaster preparedness, with features like storm shutters or reinforced roofing.3

• Maintain good credit. The Texas Department of Insurance allows insurers to use credit history to help set homeowners insurance premium rates.4 Improving and maintaining good credit can help you save money on your home insurance and improve your finances in general.

• Increase your deductible. Increasing your deductible amount is one of the most efficient ways to quickly lower your premiums. Just make sure you’re prepared to pay the higher deductible amount if you need to make a claim.

How much homeowners insurance do you need in Texas?

When you take out a mortgage on a home in Texas, the mortgage company will require you to purchase a home insurance policy. Texans should aim to have enough replacement cost coverage to rebuild their home in case of a catastrophe, as natural disasters commonly affect the Lone Star State.

Different home insurance policies will work better for different homeowners. Your location, the value of your home, and the current cost of construction materials are all important factors to keep in mind when choosing a homeowners policy. Since each home has different risk factors or potential perils, it’s important to compare quotes from at least three different insurance companies before purchasing your policy.

It’s also important to understand exactly what your home insurance policy covers when you buy it. You need to know if the policy covers everything you need it to cover or if you need to purchase supplemental policies for things like flooding, hurricane damage, or wildfire damage.

What are some of the biggest risks when owning a home in Texas?

Owning a home always comes with risks, but the specific risks vary depending on where you live. Some of the most common natural disasters in the Lone Star State can cause serious damage to your home, and your homeowners insurance may or may not cover them. It pays to be prepared for the most common perils in Texas: