Reviewed and approved by Samuel Corso, licensed Texas insurance agent.

Published August 8, 2026 · Updated October 1, 2026

Do you need home insurance when building a house in Texas?

Building a house in Texas raises insurance questions before move-in day. This guide walks through what the Texas Department of Insurance (TDI) has published on home insurance for a new build, surety bonds, windstorm inspections on the coast, vacancy, home warranties, and setting a coverage limit.

The short version. If you are building a house in Texas, the Texas Department of Insurance (TDI) says in its tip sheet Home building or renovation worries?: "Don’t forget you’ll need home insurance if you’re building a new house." That TDI note does not say when the policy should start or who insures the structure during construction, so those are questions to put to your builder and your insurance company in writing.

What a Texas homeowners policy covers, according to TDI

A Texas homeowners policy combines several coverages, and it helps to know them before deciding when a policy on a new build should start. TDI's Home insurance guide says most home policies in Texas include six coverages, which it names as dwelling, personal property, other structures, additional living expenses, personal liability, and medical payments.

The guide describes each one. Dwelling coverage, in TDI's words, pays if your house is damaged or destroyed by something your policy covers. Personal property coverage pays if your furniture, clothing, and other things you own are stolen, damaged, or destroyed. Additional living expenses coverage pays if you have to move while your house is being repaired to fix damages your policy covers.

That guide is about home policies in general, as is each TDI page cited below unless this guide says otherwise, and it does not address a house under construction. Read against a job site, the list raises practical questions, because a house that is still being built may have no furniture in it and nobody living there. The same guide says coverages vary by company, so how and when a company would write a policy on a home that is not finished is something to ask the company directly.

Who carries the risk while the house is going up

The TDI consumer pages cited in this guide do not say who insures a house in Texas while it is under construction, so that is a question to ask your builder and your insurance company in writing. Two related terms do appear in TDI material, surety bonds and a builders' risk endorsement.

Surety bonds. TDI's tip sheet Home building or renovation worries? says that if part of your project isn't done according to the contract you signed with your contractor, the insurance company that sold the surety bond will pay up to the bond's limits to complete the project. It describes two common types. Performance bonds pay if a contractor doesn't do the work outlined in the contract, and payment bonds pay subcontractors and material suppliers if your contractor doesn't pay them. The tip sheet then sets the boundary: "Bonds only pay to complete or fix what was in your contract."

As TDI describes it, a bond responds to contract work that was not done or not paid for. The tip sheet does not describe a bond as paying for fire, storm, or theft damage to the house. On timing, the same page suggests asking your contractor about a bond early because it can take a couple of weeks for them to get one, and it says your contractor will likely pass the cost along to you.

Builders' risk endorsement. An older TDI record, Commissioner's order CO-03-0110, uses the term for one endorsement. The order, which refers to a December 13, 2002, Texas Register notice and adopted dwelling endorsements filed by one national insurer (USAA), lists "a Dwelling Under Construction Builders' Risk endorsement that provides coverage for theft of building materials and supplies that will become part of the dwelling or other structure."

That is a description of one company's endorsement from more than two decades ago. It does not say what any policy offered today covers. Questions you can put to your builder in writing include who insures the structure and the materials at each stage, what that coverage names, and what changes on the day the work is finished.

Windstorm inspections when you build on the Texas coast

If you build a house in the designated catastrophe area on the Texas coast, a windstorm inspection can affect whether the home can get a policy from the Texas Windstorm Insurance Association (TWIA). TDI's tip sheet What you need to know about windstorm inspections defines the area: "Properties in 14 coastal counties and in parts of Harris County east of Highway 146 are in a designated catastrophe area."

The same TDI page says homeowners in these areas may not be able to get private insurance that covers windstorm and hail damage, and that homeowners who aren't able to get private coverage can buy a policy through TWIA. It then states the condition: "To buy a TWIA policy, most homes and properties must have a certificate of compliance verifying that the structure meets applicable building codes and can withstand high winds and hail."

Two types of certificates of compliance are issued by TDI, according to that page.

On the completed-construction route, the same page says that because it's more difficult to inspect a completed structure for building code compliance, it may cost more. It also says most new construction, roof replacements, major repairs, and other alterations require an inspection and certificate of compliance, and it lists examples of projects that do not.

A second TDI page, Questions to Ask Your Contractor BEFORE You Build or Repair, speaks to timing: "It is essential for the inspections to occur during the construction phase." That page says it is normally the contractor who coordinates the inspection dates and times. For the first tier counties along the Texas coast, it says it is in a homeowner's interest to require the builder to furnish a Certificate of Compliance upon completion of the home. It also says to always inform your insurance agent when you have construction projects.

In plain terms, TDI describes one route to a certificate while the house is being built and another after it is finished, and says the second may cost more. If your lot is in the catastrophe area, the inspection plan is something to settle with your contractor before work starts. TDI's windstorm inspections tip sheet suggests asking your contractor how they will meet the requirements for an inspection and get a certificate of compliance.

After approval, the contractor questions page describes the next step. Once the inspector submits the documentation and everything is in order, a WPI-8 is posted on TDI's website, with three working days allowed for posting, and a hard copy is mailed to the submitter, with one week allowed for delivery. The windstorm inspections tip sheet says you can check for a property's WPI-8 or WPI-8-E on the TDI Windstorm website.

The gap between "finished" and "moved in"

A newly finished house in Texas that sits empty before you move in may raise a vacancy question under a home policy. In its table of risks, TDI's Home insurance guide lists, among damages most policies don't cover, losses that occur if your house is vacant for the number of days specified by your policy, and it adds that coverages vary by company.

The guide gives a number in a different place, its list of reasons a company may nonrenew a policy. One of the reasons reads: "Your house is vacant for 60 days or more. Most companies stop your coverage if your house is vacant for that long. They usually don’t stop your liability coverage, though." The guide follows that with a suggestion to talk to your company if you plan to be out of your house for an extended time, to make sure your coverage continues.

Nothing in the guide says how a company treats a new house that has never been occupied, and the number of days and the meaning of vacant come from your own policy. If there will be a stretch between completion and move-in, you can ask your company how its vacancy provision applies to that period before the period begins.

Construction features TDI suggests raising with your builder

Some construction choices on a new Texas home are ones TDI suggests discussing with a contractor before you build. TDI's Windstorm Inspection Program page Questions to Ask Your Contractor BEFORE You Build or Repair lists items such as wind-resistant roofing material, Class 4 impact-resistant roofing material, a secondary water barrier under the roofing material, braced gable ends, truss-to-wall and wall-to-foundation connectors, impact-resistant windows or hurricane shutters, and continuous load path construction. The page describes the time when a house is being constructed as an opportune time to build in a continuous load path.

The same list includes the required upgrades to qualify for all insurance credits or discounts offered. TDI's suggestion there is to investigate possible construction credits and discounts available through your insurance company and then review them with your builder. The page does not say which features earn a credit, how large a credit is, or that any particular company offers one.

Because the page comes from TDI's windstorm program, it is written with wind in mind and does not cover every Texas build. The order TDI describes is to ask the insurance company first and then take the answer to the builder.

What TDI says about home warranties and home insurance

A home warranty and a home insurance policy do different jobs, according to TDI. TDI's blog post A home warranty is not home insurance, dated January 26, 2026, says insurance pays for damages from events your policy covers, like fire or theft, but not wear and tear, while warranties cover certain items in your home when they break down from normal wear and tear.

That post is about home warranties, also called residential service contracts, which TDI says you might be asked about when buying a home. It does not address a builder's warranty on new construction, so your builder's warranty document is the place to see what that warranty does and does not cover.

The TDI post also says companies that sell home warranties must be licensed by the Texas Department of Licensing and Regulation (TDLR). It suggests reading the fine print carefully before signing up and notes that not all home warranties are the same. For a new build, a workable habit is to keep the warranty paperwork and the insurance policy as separate documents and read each one for what it covers.

Setting the number at completion

When a home policy on a newly built Texas house starts, one figure to check is whether the dwelling limit would cover the cost to rebuild. TDI's tip sheet Do you have enough insurance coverage to pay for home or car repairs? says your home policy has limits on how much it will pay, and that if the limits are lower than the cost to rebuild your house, you'll have to pay the rest yourself.

The same tip sheet says your agent can tell you what your dollar limit is and help you estimate the cost of rebuilding your house. It adds that it's best to check in with your agent every year because construction costs change.

How a claim is paid is a second setting to check. TDI's Home insurance guide says home policies provide either replacement cost coverage or actual cash value coverage. It describes replacement cost coverage as paying to repair or replace your house and personal property at current prices, and actual cash value coverage as paying replacement cost minus depreciation. The guide's advice is to make sure your policy has replacement cost coverage.

To illustrate the difference, the guide uses a roof that costs $10,000 to replace and a $2,000 deductible. In TDI's example, a replacement cost policy would pay $8,000. If the roof's actual cash value were $7,000, an actual cash value policy would pay $5,000. These are TDI's own example figures and should be read as an illustration only.

The guide also notes that you might have different deductibles for each type of coverage. Our guide on how the wind and hail deductible works explains one deductible that may be written separately on a Texas home policy.

What to do with this

If you are building a house in Texas, these are steps you can take on the insurance side before and during construction. The list is Credify's own, and a TDI page is cited only for the facts inside a step.

• Ask about insurance during the build. Ask your builder in writing who insures the structure and the materials at each stage, and what changes when the work is finished.
• Plan coastal inspections with your contractor. If your lot is in the designated catastrophe area, ask how inspections will be handled. TDI's contractor questions page calls it essential for the inspections to occur during the construction phase.
• Ask about construction credits early. The same TDI page suggests investigating possible construction credits and discounts available through your insurance company and then reviewing them with your builder.
• Ask about vacancy before the house sits empty. TDI's Home insurance guide says most companies stop your coverage if your house is vacant for 60 days or more, though they usually don't stop your liability coverage, and that coverages vary by company.
• Read the builder's warranty as its own document. The warranty and the insurance policy are separate paperwork, and each has its own terms.
• Check the dwelling limit when the policy starts. Compare it with what it cost to build, and confirm whether the policy pays replacement cost or actual cash value and how each deductible is written.

Key facts

• TDI's tip sheet Home building or renovation worries? notes that you'll need home insurance if you're building a new house. It does not say when that policy should start.
• The same TDI tip sheet says a surety bond pays up to the bond's limits to complete a project that isn't done according to the contract, and that a bond pays only to complete or fix what was in the contract.
• TDI's What you need to know about windstorm inspections says properties in 14 coastal counties and in parts of Harris County east of Highway 146 are in a designated catastrophe area, and that most homes and properties must have a certificate of compliance to buy a TWIA policy.
• The same TDI windstorm page says a WPI-8 is issued for ongoing construction and a WPI-8-E for completed construction, and that inspecting a completed structure may cost more because it is more difficult.
• TDI's Questions to Ask Your Contractor BEFORE You Build or Repair says it is essential for windstorm inspections to occur during the construction phase, and suggests investigating possible construction credits and discounts available through your insurance company.
• TDI's Home insurance guide says, in its list of nonrenewal reasons, that most companies stop your coverage if your house is vacant for 60 days or more and usually don't stop your liability coverage. Elsewhere it says coverages vary by company.
• TDI's blog post A home warranty is not home insurance says a home warranty is different than home insurance and that companies selling home warranties must be licensed by TDLR. The post is about home warranties in general.
• TDI's Do you have enough insurance coverage to pay for home or car repairs? says that if your policy limits are lower than the cost to rebuild your house, you'll have to pay the rest yourself.

Sources: Texas Department of Insurance, Home building or renovation worries? Ask your contractor to buy a surety bond, Questions to Ask Your Contractor BEFORE You Build or Repair, What you need to know about windstorm inspections, A home warranty is not home insurance, Do you have enough insurance coverage to pay for home or car repairs?, Home insurance guide, and Order CO-03-0110 New Property Endorsements. This page is general information, not legal advice. For questions about your legal rights, check your policy or contact the Texas Department of Insurance.

Take the next step

Before the build starts, it helps to know who insures the structure during construction, how any coastal inspection will be handled, and when your own home policy will begin. If you want the wider picture first, how to choose home insurance in Texas walks through comparing coverage, and independent agency vs. direct looks at two ways of shopping for a policy.

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