For many Texas homeowners, the annual insurance renewal has become a moment of unease.

A premium increase can mean hundreds — sometimes thousands — of additional dollars a year. For families across the San Antonio area, those increases matter well beyond the insurance bill itself. They can raise monthly housing costs, put additional pressure on household budgets and make the long-term cost of homeownership harder to predict.

New research from Rice University’s Kinder Institute for Urban Research puts numbers behind what many Texas homeowners have already been feeling.

Between 2009 and 2024, the average homeowners insurance premium in the median Texas county increased 74% after adjusting for inflation, while median household income increased only 11%, according to the Kinder Institute report, The Insurance Squeeze: Rising Premiums, Affordability, and Income Inequality Across Texas Counties Since 2000.

That widening gap is making insurance an increasingly important part of Texas’ housing affordability story.

Insurance Is Taking a Bigger Bite Out of Household Budgets

In 2009, homeowners insurance represented about 2.93% of median household income in the typical Texas county.

By 2024, that figure had climbed to 4.65%. For households earning 80% of their county’s median household income, insurance premiums accounted for about 5.81% of household income.

The increases have accelerated in recent years.

Texas’ median homeowners insurance premium increased 18% from 2022 to 2023 and another 16.2% from 2023 to 2024 in nominal dollars. Even after adjusting for inflation, the increases were 13.4% and 12.9%, respectively.

The Kinder Institute analysis also found that approximately 7.04 million Texas households — about 64% of households statewide — could not afford the median-valued home in their county in 2024 when insurance and other housing expenses were included and affordability was measured using the commonly used threshold of spending no more than 30% of gross income on housing.

Researchers modeled how further insurance increases could deepen that pressure. A 4% increase in premiums could make a median-valued home unaffordable for an additional 20,077 Texas households, while a 10% increase could add nearly 49,900 households to that total.

Those figures are estimates rather than predictions, but they show how even incremental increases in insurance costs can affect overall housing affordability.

San Antonio-Area Households Face Their Own Affordability Gap

For the San Antonio-New Braunfels metropolitan area, the Kinder Institute calculated a 2024 homeownership affordability gap of approximately $77,716.

Researchers placed median household income at $76,213, median home value at $278,800 and average homeowners insurance premiums at $2,600 across the metro area.

The affordability gap represents the difference between the home value a household could reasonably afford under the study’s assumptions and the median home value available in that market.

It does not mean every San Antonio-area family faces an identical shortfall. Household incomes, home values, taxes, deductibles and insurance premiums vary considerably by community.

But the figure provides an important measure of how insurance fits into the broader cost of homeownership, particularly as San Antonio and surrounding communities continue to grow.

Kendall and Comal Counties Show How Affordability Pressure Extends Beyond San Antonio

The Kinder Institute report also highlights affordability pressure in fast-growing communities surrounding San Antonio.

Kendall County ranked among the 10 Texas counties with the largest homeownership affordability gaps in 2024. Researchers calculated a gap of approximately $202,576, with median household income of $114,962 and median home value of $512,700.

Comal County also appeared among the state’s largest county-level gaps, with an estimated affordability gap of $150,572, median household income of $101,889 and median home value of $427,200.

Those figures are particularly relevant to communities along the San Antonio-New Braunfels growth corridor, where rapid development and rising property values have reshaped the housing market over the past several years.

They also reinforce that housing affordability is not simply an inner-city issue. Higher carrying costs can affect suburban and exurban homeowners as well.

What Is Driving Higher Texas Home Insurance Costs?

There is no single cause behind rising homeowners insurance premiums.

The Kinder Institute report points to a combination of catastrophic weather, litigation patterns and broader structural cost pressures over time. It also identifies major premium increases following periods of severe Texas weather, including Winter Storm Uri and Hurricane Beryl.

Insurance costs can also vary based on rebuilding expenses, a home’s age, location and characteristics, deductibles, claims history and the amount and type of coverage purchased.

That means two homes in the same general San Antonio-area market can receive noticeably different quotes.

What the statewide data show more clearly is that insurance costs have been rising considerably faster than incomes.

Rising Premiums Do Not Affect Every Household the Same Way

The Kinder Institute report also found that households have not experienced rising insurance costs equally.

Higher-income households were generally better positioned to absorb increasing premiums. During portions of the study period, homeownership continued to grow among households earning more than 120% of their county’s median household income despite escalating insurance costs.

Lower- and moderate-income households showed more vulnerability.

For households earning up to 120% of median income, researchers found periods in which faster premium increases were significantly associated with declining homeownership rates. The report cautions that the relationship became less clear from 2019 through 2024 because pandemic-era migration, mortgage-rate changes and other market conditions affected housing decisions.

For San Antonio-area families, that distinction matters because a large insurance increase does not have the same effect on every budget. Some households may be able to absorb it. Others may have to cut spending elsewhere, increase deductibles, reduce coverage or reconsider what they can afford in a home.

What San Antonio-Area Homeowners Can Do

Homeowners cannot control statewide premium trends, but they can take steps to better understand their coverage and potentially reduce what they pay.

The Texas Department of Insurance recommends shopping around rather than automatically renewing the same policy each year. Consumers can compare companies, sample rates, complaint histories and financial information through HelpInsure.com, operated by TDI and the Office of Public Insurance Counsel.

Homeowners can also ask insurers about discounts for alarm systems, bundled policies or a claims-free history.

A higher deductible may lower the annual premium, but homeowners should consider whether they could comfortably pay that deductible following a major loss.

It is also important to compare coverage, not just price.

Homeowners should review whether a policy pays replacement cost or actual cash value. Replacement cost coverage generally reflects the current cost of repairing or replacing damaged property, while actual cash value subtracts depreciation and can result in a substantially larger out-of-pocket expense.

Texas law does not require homeowners insurance, but mortgage lenders generally require borrowers to maintain it while a home loan remains outstanding. Homeowners should also remember that standard homeowners insurance generally does not cover flooding, which typically requires separate coverage.

Before changing insurers, homeowners should verify that a new carrier is licensed, review complaint information and make sure the replacement policy is active before canceling existing coverage.

Insurance Is Becoming a Bigger Part of the Cost of Owning a Home

The Kinder Institute for Urban Research is part of Rice University and conducts research on housing, neighborhoods, affordability, resilience and other issues affecting communities across Texas. Its latest insurance analysis uses Texas Department of Insurance data from 2000 through 2024 along with U.S. Census Bureau housing and demographic information covering every Texas county.

The findings do not suggest that insurance alone is responsible for housing affordability challenges in San Antonio or surrounding communities.

Home prices, mortgage rates, property taxes, maintenance costs and household income remain major pieces of the equation.

But insurance is becoming a larger one.

For San Antonio-area homeowners, especially those in fast-growing communities where home values have climbed, the cost of insuring a property is increasingly part of the larger question of what it takes to comfortably own and remain in a home.

As insurance costs and South Central Texas housing conditions continue to change, My Neighborhood News will continue following developments that could affect homeowners, prospective buyers and neighborhood affordability across the San Antonio area.

By Tiffany Krenek, My Neighborhood News 

Tiffany Krenek has been on the My Neighborhood News team since August 2021. She is passionate about curating and sharing content that enriches the lives of our readers in a personal, meaningful way. A loving mother and wife, Tiffany and her family live in the West Houston/Cypress region.