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.

2019 Actuarial Analysis

Based on 2019 actuarial analysis and the overall statewide rate change, TFPA rates would need to increase by approximately +7.9% for homeowners, +9.2% for condominiums, +9.4% for tenants, and +9.5% for extended coverage policies to achieve rate adequacy.

Recent Rate Changes Based on 2019 Actuarial Analysis
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.

As directed by the Governing Committee, the TFPA staff made rate filings with TDI on December 20, 2019 for its various lines of coverage. The filings included proposed rate changes aligned with the 2019 actuarial analysis for TFPA. The rate filings were approved by TDI in March 2020.

The rate changes were scheduled to apply to new and renewal business beginning May 1, 2020. In April, TDI issued an order delaying implementation of the new rates. The new rates went into effect August 1, 2020 in accordance with TDI's order. They apply to all new and renewal policies and vary for each individual policy, depending on territory.


2020 Rate Changes

Region Territory Homeowners Dwelling Tenant Condominium
Fire EC
Central North -Greater Dallas/Ft. Worth 2, 3, 4 10.0% -1.2% 10.0% 10.0% 10.0%
Central North - Remainder 16C, 16S, 17, 19C 10.0% -1.2% 10.0% 10.0% 10.0%
Central South 5, 6, 7, 12, 13, 14, 15C 10.0% -1.2% 10.0% 2.6% 10.0%
North/Northwest 15N, 16N, 18, 19N, 20 10.0% -1.2% 10.0% 5.6% 2.9%
Seacoast - Tier 1 8, 9, 10 10.0% -1.2% -10.0% 10.0% 4.5%
Seacoast - Tier 2 1, 11 7.3% -1.2% 10.0% 10.0% 10.0%
Statewide Average All 7.9% -1.2% 9.5% 9.4% 9.2%