Business Lines · Habitational Property
Apartment building insurance in Texas: what actually drives your renewal.
Single buildings through large multi-property schedules. Standard and surplus markets both.
The short version
Apartment coverage combines commercial property on the structures with general liability for the premises, usually alongside loss of rents, equipment breakdown, and an umbrella layer. In Texas three things drive the renewal more than anything else: the age and condition of the roof, the four building systems carriers underwrite to — roof, HVAC, plumbing, electrical — and the valuation on your statement of values.
The most expensive gap is usually not a missing policy. It's coinsurance. If a building is insured for less than the required percentage of replacement cost, the carrier reduces every claim payment proportionally, including partial losses. An agreed value endorsement removes that penalty, and many owners don't know whether they have one.
Coinsurance
Why underinsuring costs more than you saved.
The most misunderstood clause in commercial property — and it punishes exactly the decision that feels prudent.
How the penalty works
A building costs $5,000,000 to replace. The policy carries 80% coinsurance, so you were required to insure to $4,000,000. You insured it for $3,000,000 — 75% of what was required. A $200,000 partial claim is paid at roughly 75%, about $150,000, less your deductible.
Why it happens to careful owners
Construction costs moved sharply and limits set a few years ago quietly stopped matching replacement cost. Nobody did anything wrong. The building simply became more expensive to rebuild than the policy admits.
The fix is agreed value
It suspends the coinsurance clause — you and the carrier agree the value up front and partial claims are paid without the proportional penalty. It requires a current statement of values and usually costs little.
Check this first
If you own multi-family and don't know whether you have agreed value, that's the single most valuable thing to look up on your policy today.
Eligibility
The four systems that decide whether you're even quotable.
Habitational property in Texas is a tight market. Carriers have absorbed years of hail and water losses and underwrite hard.
Roof
The dominant factor. Age, material, and last replacement date drive both eligibility and how a loss settles. An older roof can move you from replacement cost to actual cash value, or off appetite entirely.
Plumbing
Age and material. Polybutylene is a common decline. Cast iron drain lines draw scrutiny because of the water-damage frequency behind them.
Electrical
Aluminum branch wiring and certain older panel types are frequent outright declines regardless of the rest of the risk.
HVAC
Age, and whether there's a central system or individual units.
Commonly Missing
The coverages owners find out about after a loss.
Ordinance or law is the one that quietly ruins older properties — after a significant loss, current building code applies to the repair, and code has moved since the building went up.
- Ordinance or law A — the undamaged portion you're forced to demolish
- Ordinance or law B — demolition and debris removal
- Ordinance or law C — increased cost of rebuilding to current code
- Loss of rents — with a realistic period of restoration
- Equipment breakdown — boilers, chillers, elevators, pool equipment
- Hired & non-owned auto — maintenance staff in their own trucks
- Crime / employee dishonesty — onsite managers handling rent and deposits
- Extended period of indemnity — tenants don't return the day repairs finish
On a 1970s or 1980s complex, code-upgrade cost after a large loss can exceed the direct damage. Without Coverage C the owner funds that difference.
Liability Carve-Outs
Where habitational GL is narrower than it looks.
General liability on apartments is rarely as broad as the declarations suggest.
Assault and battery sublimits
Frequently sublimited well below the policy limit, or excluded. Given how many serious apartment liability claims involve an altercation or criminal act on the premises, check this before anything else.
Animal and dog bite exclusions
A pet-friendly property with a breed exclusion in the policy and no breed restriction in the leases has a live gap. The lease and the policy have to agree.
Habitability and discrimination
Mold, bed bugs, and habitability disputes are commonly excluded or sublimited. Fair housing allegations generally aren't covered by GL at all — that's a separate management liability form.
Read the excess layer
Excess capacity over habitational often carries its own sublimits that reintroduce the carve-outs you just paid to fix in the primary. Don't assume it follows form.
Straight Talk
When you need less than you think.
A duplex or fourplex isn't a commercial account
Small residential rental property is usually better on dwelling policies — simpler, cheaper, adequate. The crossover comes with unit count and total insured value, not with the word “apartment.”
You may not need the highest limit quoted
Excess over habitational is priced steeply. If no lender or contract requires a specific limit, the honest analysis is a realistic worst case against your equity, not the biggest number offered.
Higher deductibles can be the right trade
For a well-capitalized owner, taking a higher deductible to fund better roof settlement terms or ordinance or law coverage is often a better purchase than a low deductible with ACV roofs.
Skip nothing on the cheap list
Equipment breakdown, ordinance or law, and hired and non-owned auto cost little relative to what they cover. If something has to come out to hit a budget, it shouldn't be one of these.
Get Started
Request an apartment building insurance quote.
Single buildings through large schedules. Send the statement of values and the expiring policy if you have them.
Reach us directly
You'll hear back from a real person on our team, not a call center.
Plano, TX 75074
Habitational FAQ
Questions we hear often.
What does apartment building insurance cover?
Commercial property on the buildings and general liability for the premises, typically with loss of rents, equipment breakdown, and an umbrella layer. Ordinance or law coverage matters on older properties and is often missing.
What is coinsurance on a commercial property policy?
A clause requiring you to insure the building to a set percentage of replacement cost, often 80% or 90%. Insure for less and the carrier reduces every claim payment proportionally, including partial losses. An agreed value endorsement removes the penalty.
Why is my wind and hail deductible a percentage?
Percentage wind/hail deductibles are standard on Texas habitational property. On $10,000,000 of insured values, 2% is a $200,000 retention on a hail claim.
What is ordinance or law coverage and do I need it?
It pays for code-required upgrades after a covered loss, demolition of undamaged portions you're forced to remove, and debris removal. On an older complex the code-upgrade cost can exceed the direct damage, so yes.
Why do carriers ask the age of my roof, HVAC, plumbing, and electrical?
Those four drive habitational loss frequency, so they determine both eligibility and how losses settle. Documented updates earn better terms; undocumented ones earn nothing.
Does my general liability cover an assault on the property?
Often only up to a sublimit well below the policy limit, and sometimes not at all. Assault and battery sublimits are common on habitational liability and worth checking specifically.
Is loss of rents included?
Usually — but check the period of restoration. It should reflect realistic post-catastrophe repair timelines, and an extended period of indemnity covers the re-leasing gap after repairs finish.
My building has polybutylene plumbing or aluminum wiring. Can I get coverage?
It narrows the market considerably and causes outright declines with many standard carriers. It's generally still placeable, often through surplus lines, and remediation materially improves both eligibility and pricing.