What insurance is required in Texas?

Required by Texas law: auto liability

Under Transportation Code Section 601.051, you may not drive a motor vehicle in Texas unless financial responsibility is established for it. For almost everyone that means an auto liability policy with at least 30/60/25 limits: $30,000 for injury to one person, $60,000 for injuries to two or more people, and $25,000 for property damage in one crash (Section 601.072).

The law also lists narrow alternatives (a surety bond, a deposit with the comptroller or a county judge, or self-insurance) and exceptions, such as certain collector vehicles used only for exhibitions under an affidavit, and golf carts or neighborhood electric vehicles operated only as the Transportation Code allows.

Required by Texas law in some cases: the SR-22

An SR-22 isn't a type of insurance. It's a certificate your insurer files with DPS showing you carry at least the minimum liability coverage. DPS requires one if your license was suspended because of a crash, if you have a second or later conviction for no insurance, or if a civil judgment was filed against you.

DPS says you must keep the SR-22 on file for two years from the conviction that required it, or two years from the date of a judgment. An insurance card won't substitute for it, and if the SR-22 lapses, your insurer notifies DPS and your license and registration can be suspended.

Usually optional by law: workers' compensation

Texas is unusual here. Labor Code Section 406.002 says that, except for public employers and as otherwise provided by law, an employer may elect to obtain workers' compensation coverage. Employers who go without coverage (nonsubscribers) have their own reporting duties and legal exposure; our nonsubscriber guide covers them.

One common "otherwise provided by law" case: under Section 406.096, a government entity that signs a building or construction contract must require the contractor to certify workers' comp coverage for each employee on the public project, and subcontractors must certify too. Private customers and general contractors can also require it by contract.

Not required by law, required by your lender: home and flood

No Texas statute makes you buy homeowners insurance. But TDI notes that if you still owe money on your home, your lender will require it, and the mortgage documents spell out the coverage and deductibles.

Flood is a federal requirement tied to the loan. FloodSmart says that in communities that take part in the NFIP, flood insurance is mandatory for federally backed mortgages on buildings in high-risk zones (zones starting with A or V). Lenders can also require flood coverage outside those zones as a condition of the loan, so read your loan documents.

Required by contract: renters, financed cars, boats

Texas law doesn't require renters insurance, but a lease can. Read the lease for the minimum liability limit the landlord wants and whether they must be listed on the policy.

If your car is financed or leased, the loan or lease almost always requires comprehensive and collision on top of the 30/60/25 liability the state requires.

Boats are similar. Texas Parks and Wildlife requires registration for motorized vessels and some larger non-motorized boats, but its registration rules don't include proof of insurance. Marinas and boat lenders commonly require it anyway.

How to find out what you're actually required to carry

Before you shop, collect the documents that set your requirements:

• Your mortgage or deed of trust insurance clause, or the lender's insurance requirement letter.
• Any flood determination from your lender, which states whether the building is in a high-risk zone.
• Your lease's insurance section, including required liability limits.
• Your auto loan or lease contract, which lists required coverages and maximum deductibles.
• For a business: customer and general-contractor contracts, which often set workers' comp, liability and auto requirements.
• Any court or DPS notice requiring an SR-22.