Premium Increases


Two Texas Insurance Code provisions require insureres to notify policyholders about premium increases prior to renewal.

Section 550.002 - Applicable to All Lines

An insurer who receives automatic premium payments through the withdrawal of funds from a person's account in a financial institution including an escrow account, as authorized by that person for purposes of premium payments on any insurance coverage, cannot increase the payments without following certain notification provisions.

The automatic premium payments include

  • property policy renewal premiums paid from escrow
  • bank drafts used to pay monthly life, accident, health, mortgage cancellation, credit life
  • any insurance premiums paid from escrow, savings or checking accounts.
If a premium payment is increasing more than $10.00 or 10 percent of the previous amount per month, the insurer must provide a 30 day prior notification of the increase and provide contact information so the consumer can object to the increase.

If the policy is insuring property under a deed of trust to be paid from an escrow account, notification must be 60 days in advance of the increase.

Section 2251.005 – Applicable Only to Residential Property

An insurer is required to send notice to a residential property policyholder of any renewal rate increase of 10 percent or more at least 30 days prior to the renewal date.