Texas FAIR Plan Association (TFPA) rates (the cost of insurance per unit of exposure) determine the amount of premium charged to each TFPA policyholder. Adequate rates help ensure TFPA can meet its financial obligations. Rates are proposed by TFPA staff to the TFPA Governing Committee and are subject to review and approval by the Texas Department of Insurance (TDI) prior to use. Premiums are calculated based on standard industry rating factors, including amount of insurance, territory, fire protection, type of construction, deductible amount, and any optional additional coverages. TFPA does not use credit scoring in its rate determination.

Statutory Requirements
Texas Insurance Code Chapter 2211 requires that TFPA rates be set in an amount sufficient to pay claims and to meet all expenses incurred in the writing and servicing of the business. Rates include factors for projected covered losses, operational expenses, agent commissions, and premium taxes. The Commissioner of Insurance must enter an order approving or disapproving a proposed rate change by the Association no later than 60 days after it is filed.

Recent Rate Changes
TFPA’s Governing Committee considers and authorizes staff to propose rate changes, as needed, annually. TFPA can increase rates as many times as necessary in a calendar year to make sure it meets its financial obligations.

The TFPA Governing Committee analyzed and considered the 2021 actuarial analysis for TFPA before initially submitting the rate filings for approval by the Commissioner of Insurance on January 28, 2022. TFPA withdrew and resubmitted revised rate filings on April 14, 2022, after TDI discovered an error in the initial filings. On May 19, 2022, the Texas Department of Insurance approved rate changes for TFPA Homeowners, Dwelling, Condominium, and Tenant coverage forms. The rate changes apply to new and renewal business beginning August 1, 2022.

The rate changes vary by region and are used to determine the premium for each individual policy.

2022 Rate Changes

Region Homeowners Dwelling Condominium Tenant
Fire EC
Central North - Greater Dallas/Ft. Worth 10.0% 0.7% 10.0% 10.0% 10.0%
Central North - Remainder -4.0% 0.7% 10.0% 10.0% 10.0%
Central South 10.0% 0.7% 10.0% 8.7% -7.6%
North/Northwest 10.0% 0.7% 10.0% 10.0% -4.0%
Seacoast - Tier 1 10.0% 0.7% -10.0% 2.3% 10.0%
Seacoast - Tier 2 6.9% 0.7% 10.0% 10.0% 10.0%
Overall Statewide 7.6% 0.7% 9.5% 9.0% 9.0%