The renewal shows up and the number is higher. No claims. No new drivers. No changes to the house. Same coverage, same address, same everything you had last year. So you call and ask what happened, and the answer is usually some version of “rates went up across the board.” That is true, and it is also not an explanation.
Jansen Morris, an agent at Texas Select Insurance Group in San Angelo, says this is the most common question the office gets. It deserves a real answer, so he walked through the whole thing: how carriers set a price, what pushed Texas rates upward between 2020 and 2024, which pieces of it a policyholder can influence, and what an independent agency can do when your renewal lands.
Your premium is only partly about you
The first thing worth understanding is that insurance is priced on pools rather than individuals. Your premium is not calculated solely on your personal history. It is calculated on what it costs the carrier to pay claims across a large group of policyholders in your area and in your risk category.
Jansen uses a simple picture for it. Imagine a town pool that every household in the neighborhood pays into. When someone needs a payout, the pool covers it. If the neighborhood starts filing more claims, or if the cost to settle each claim climbs, then everyone’s contribution has to climb too, including the neighbors who never filed anything. That is the mechanism at work when your premium rises and you did nothing wrong. The pool got more expensive to maintain, and the cost got spread.
Layered on top of that, carriers run on relatively thin margins. Premiums come in, claims and operating costs go out, and what is left is profit. When claim costs rise sharply, a company has two levers: raise rates, or stop writing policies in certain areas. Between 2020 and 2024, Texas saw both.
You insure the rebuild, not the sale price
One of the largest drivers is construction cost. When you buy a homeowners policy, what you are insuring is the cost to rebuild your home. The relevant number is not what the house would sell for. It is what it would cost to clear whatever is left after a loss and build it back from scratch with today’s materials and today’s labor.
Those numbers moved a long way in four years. Lumber spiked as pandemic supply chains broke down. Steel, drywall, and roofing materials followed. Skilled trades, the carpenters and framers and roofers and drywall crews, got harder to find and more expensive to hire. And when repair demand surges after a major storm, contractors in the affected area book out for months, which pushes costs higher still.
Texas had a compounding factor on top of all of it. The February 2021 winter storm hit nearly every part of the state at once: burst pipes, damaged roofs, flooded interiors. The repair demand was enormous, and it arrived at the exact moment materials were already scarce and expensive. That single event opened a gap between what insurers had priced coverage at and what those claims cost to pay. Carriers went back to the replacement cost assumptions built into policies across Texas, found them out of date, and repriced. That repricing is what showed up on a lot of renewals, including renewals for people who had never filed a claim.
Hail is a statewide pricing event
In the Concho Valley, nobody needs to be told that West Texas weather is serious. What is less obvious is how much Texas storm activity shapes pricing for the whole state. Texas has more major hail events than any other state, and in 2024 alone it recorded 878 of them. In 2023, a series of storms in the Dallas-Fort Worth area produced an estimated seven to eight billion dollars in insured losses. One metro area, one year.
This region contributed its own. In May 2024 a supercell tracked through the area with hail described as tennis ball to softball size in places, along with damaging winds and flooding, part of a stretch that gave San Angelo some of its most severe hail in nearly three decades.
When carriers pay out large volumes of claims across a state, that experience feeds back into what they charge statewide and regionally. If your town got hit last spring and your neighbor’s roof came off, the overall claims picture in your region affects what carriers charge to write new policies there going forward. It is the pool again. When the pool pays out heavily, contributions rise for everyone in it, and that math runs the same way at every carrier.
The cost most policyholders never see
There is one more layer underneath all of this, and almost nobody outside the industry hears about it. It is called reinsurance, and it is insurance for insurance companies.
Consider what happens when a hurricane or a large tornado outbreak hits a populated area. A single carrier can face billions of dollars in claims at once, and no company holds that much cash on its own. So carriers buy their own coverage from large reinsurance companies to protect against catastrophic loss.
The price of that protection went up substantially from 2022 through 2024, with some property catastrophe reinsurance rates rising by as much as 50 percent at certain renewal periods. The causes are the same ones already at work: more frequent severe weather, higher rebuild costs, and a few unusually expensive global catastrophe years. When it costs a carrier more to buy reinsurance, that cost travels downstream and lands as upward pressure on the premiums the rest of us pay. You will never find a line item for it on your declarations page, but it is built into what carriers charge to write coverage in a high exposure state like Texas.
Why the auto side moved too
Auto premiums rose for a parallel set of reasons. Modern vehicles are expensive to repair in ways they were not fifteen years ago. Think about what is packed into a car today: cameras in the bumpers and mirrors, radar sensors, adaptive cruise control, automatic emergency braking, lane keep assist. Those systems make vehicles safer. They also mean a bumper tap in a parking lot, which used to be a four hundred dollar repair, can now involve replacing sensors, recalibrating cameras, and running diagnostics, and land somewhere between fifteen hundred and three thousand dollars.
Parts costs rose more than 43 percent from early 2019 to early 2025 according to federal Consumer Price Index data, and body shop labor rates climbed with the same skilled labor shortage that hit construction. When a vehicle is totaled, the payment is based on actual cash value, which reflects used car prices that stayed elevated well after pandemic demand cooled. West Texas adds its own wrinkle: longer distances between towns mean more highway miles, and a high speed collision on a rural highway is far more likely to total a vehicle than a low speed fender bender in town. Add the rising cost of medical care and personal injury litigation, which drives liability settlements, and a clean driving record was never going to fully insulate anyone. The whole market moved.
The part you can influence
Some of this is within reach. Your deductible is the clearest lever, since taking on more of the risk yourself generally lowers the premium. If your cash reserves can absorb a twenty five hundred or five thousand dollar out of pocket expense, moving up from a one thousand dollar deductible can reduce the premium meaningfully. What makes sense depends on your reserves and your tolerance for risk, so it is a conversation to have with your agent rather than a rule to apply.
A coverage review is worth doing at renewal instead of renewing on autopilot, because policies drift. An older vehicle with low market value may not need the same physical damage coverage it once did, and a renovated home may need its replacement cost estimate updated. Bundling home and auto with one carrier earns a discount at many companies, though the savings vary and sometimes the best home rate and the best auto rate sit at two different carriers, which an agent can test both ways.
Credit matters in Texas as one factor among several. State law prohibits a carrier from basing a decision on credit alone, but strong credit generally works in your favor where credit scoring applies. Texas law also requires insurers to re-rate your policy at renewal using a current credit report if you or your agent request it, once per year, which is worth knowing if your credit has improved. Your own record still counts as well, since at fault accidents and certain moving violations affect auto rates, and a long claim free stretch is something some carriers reward over time.
Jansen is honest about how far any of this goes. These levers help at the margins. None of them guarantee a lower total premium in a hard market, and expecting a dramatic reduction in the current environment may not be realistic. They are still worth reviewing, and a good agent will walk through them with you.
Where an independent agency fits
This is the point where the type of agency starts to matter in a practical way. A captive agent works for one company, so when your rate goes up there, your options are to accept it, raise your deductible, or cut coverage. You cannot ask a State Farm agent to quote you on a Nationwide policy.
An independent agency like Texas Select represents multiple carriers, which means at renewal your current coverage profile can be run against several companies to see where you are priced competitively. If your carrier has repriced your risk in a way that no longer reflects the market, that shows up in the comparison. It does not mean something cheaper always turns up. In some renewal periods the whole market has moved and every carrier in a category sits at a similar price. What access to multiple carriers buys you is the ability to find out, and to act when a carrier shifts pricing in your favor or a new one enters your segment.
There are signs the environment is loosening. The Texas Department of Insurance reported that the pace of homeowners rate increases slowed from roughly 19 percent in 2024 to about 4 percent in 2025. The window where shopping pays off is not always open, and right now it is opening back up.
One practical note to close on. Do not wait until the last minute. A week before renewal is not enough runway to shop multiple carriers and complete a policy change cleanly. Give your agent enough time to do a real comparison, and you get a real answer instead of a rushed one.