Key Takeaways
- Texas commercial property insurance uses file and use rate regulation
- Commercial policies must disclose terrorism coverage options under TRIA
- Texas allows surplus lines placement after diligent search of 3 admitted insurers
- Surplus lines tax in Texas is 4.85% of premium
- Business interruption and extra expense coverage follow standard commercial forms
Last updated: January 2026
Texas Commercial Property Insurance
Texas regulates commercial property insurance with specific requirements for rates, surplus lines, and coverage availability.
Rate Regulation
Under Texas file and use system, commercial property insurance rates:
- May be used immediately upon filing
- Subject to TDI review after implementation
- Must not be excessive, inadequate, or unfairly discriminatory
- Can be disapproved if TDI finds violations
Commercial Rate Filing
| Requirement | Details |
|---|---|
| Filing | Required before use |
| Approval | Not required before use |
| Review | TDI reviews after implementation |
| Disapproval | TDI can disapprove after review |
Terrorism Insurance
TRIA (Terrorism Risk Insurance Act)
- Federal program providing terrorism insurance backstop
- Texas insurers must offer terrorism coverage
- Policyholder can accept or reject terrorism coverage
- Disclosure of coverage terms required
Required Disclosures
- Coverage limits for terrorism
- Premium for terrorism coverage
- Right to accept or reject
- Exclusions and limitations
Commercial Property Coverage
Texas commercial property follows standard forms:
Coverage Types
| Coverage | Description |
|---|---|
| Building | Structure and permanently attached items |
| Business Personal Property | Contents, inventory, equipment |
| Business Income | Lost income during restoration |
| Extra Expense | Additional costs to continue operations |
Surplus Lines Insurance
Texas allows surplus lines insurance for risks not available in the admitted market:
Surplus Lines Requirements
| Requirement | Details |
|---|---|
| Diligent Search | Must contact 3+ admitted insurers |
| Export List | Some risks pre-approved for export |
| Surplus Lines Agent | Must use licensed SL agent |
| Surplus Lines Tax | 4.85% of premium |
| Stamping Fee | $25 per policy or 0.06% |
| Disclosure | Must disclose SL status to insured |
Export List Risks
Texas maintains a list of risks that can be placed directly with surplus lines insurers without a diligent search:
- Aviation liability
- Excess liability
- Employment practices liability
- Directors and officers liability
- Environmental impairment liability
Business Interruption Insurance
Texas commercial policies include business interruption provisions:
Key Provisions
- Coverage for lost income during restoration period
- Waiting/deductible period typically 72 hours
- Period of restoration clearly defined
- Extended period of indemnity available
- Civil authority coverage for government-ordered closures
Extra Expense Coverage
- Covers costs to continue operations during restoration
- Separate limit from business interruption
- Examples: temporary location, expedited repairs
Builders Risk
Texas builders risk insurance:
- Covers buildings under construction
- Available on completed value or reporting form
- Theft coverage may require endorsement
- Transit coverage for materials available
Test Your Knowledge
How many admitted insurers must be contacted before placing a risk in the Texas surplus lines market?
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Test Your Knowledge
What is the Texas surplus lines tax rate?
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