New homeowners in Texas may have to look a little harder for insurance policies as another company has pulled out of the state.
In a letter to shareholders, Progressive Insurance CEO Tricia Griffith stated the company is “temporarily restricting new homeowners' business.”
The letter adds that “Reducing the impact from weather-related volatility is strategically important."
Progressive halted homeowners' insurance policies just over a month after Hurricane Beryl tore across Houston. And this isn't the only major insurance company to do so. Foremost Insurance, a holding of Farmers Insurance, stopped writing and renewing new policies a little more than two weeks before Beryl hit.
In a letter to a customer, published in the Houston Chronicle, Progressive said: “We recently reviewed our exposure and risks relating to natural and catastrophic losses, and have determined that we will no longer offer this insurance program in your area. As a result, this policy will not be renewed at the end of your current policy term."
While getting a policy now is tougher, holding onto a policy is causing increasing pain in the wallet of a homeowner due to spiraling insurance rates. One Texas resident says their policy rate has gone from $2,600 last year to $8,800 in just the last year.
Hiking rates or ending coverage isn't unusual. After 2021's Hurricane Ida, the Louisiana Insurance Commissioner had to suspend policy cancellations. After the order was rescinded, many Louisiana residents saw their insurance coverage not renewed. These homeowners needed to purchase homeowners' insurance from a state insurance company.
Texas has its own version called the Texas Fair Plan Association, a body founded by the Texas Legislature in 1995. Texas homeowners denied coverage can seek out the Texas Fair Plan Association which helps people denied coverage get home insurance.
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