Every September, National Preparedness Month encourages families and businesses to take steps to safeguard their property and finances. In Texas, where hurricanes, hail, and severe storms regularly cause billions of dollars in insured losses, being prepared means more than just stocking supplies—it means being insurance ready.
If you own residential or commercial property in Texas, two of the most critical steps you can take are:
- Understanding your insurance policy—including whether it pays Actual Cash Value (ACV) or Replacement Cost Value (RCV).
- Getting a pre-loss property inspection to document your building’s condition before disaster strikes.
Both steps can determine whether your claim gets paid quickly and fairly—or whether you face disputes and costly delays.
Why Understanding Your Insurance Policy Is Essential in Texas
Insurance contracts are dense, and too often, policyholders only learn about exclusions and limitations after a loss. Before the next hurricane or hailstorm season, review your policy and answer these key questions:
- What perils are covered? Does your policy cover wind, hail, and flood damage—common risks across Texas?
- What exclusions apply? Many policies exclude earth movement, wear and tear, or pre-existing damage.
- What are your limits and deductibles? Texas policies often have separate deductibles for wind and hail, which can be much higher than your standard deductible.
- What are your obligations? Most policies require prompt reporting, temporary repairs, and proof of loss.
Being proactive now ensures you’re not blindsided later when you file a claim.
ACV vs. RCV: A Key Distinction for Texas Policyholders
One of the most important details in your policy is whether losses are valued at Actual Cash Value (ACV) or Replacement Cost Value (RCV).
- Actual Cash Value (ACV): Pays to repair or replace property minus depreciation. Example: If your 10-year-old roof in Houston is damaged by hail, ACV coverage may only pay a fraction of what a new roof costs.
- Replacement Cost Value (RCV): Pays to repair or replace property at today’s prices, without deducting depreciation. Using the same example, RCV coverage would pay for a new roof of similar quality.
Many Texas property insurance policies initially pay ACV and only release the difference up to RCV after you complete repairs. Knowing which applies to you can prevent unexpected financial gaps. WATCH OUT: many policies now limit certain building components (particularly roofs) to ACV only. So even if you have an RCV policy, you may not have RCV coverage on the entire building.
Certain policies also include a “depreciation schedule” limiting your coverage based on the age of the building. Make sure you have reviewed all endorsements to ensure you know what is covered at what level.
Why a Pre-Loss Inspection Strengthens Texas Insurance Claims
Even when coverage is clear, disputes often arise over the condition of your property before the loss. A pre-loss inspection provides documented evidence—photos, videos, and written reports—that protect your rights under Texas insurance law.
Benefits include:
- Proof of condition: Establishes a baseline for your property.
- Defense against depreciation claims: Insurers may argue damage is due to age or wear; inspection records help you push back.
- Stronger negotiating position: Independent proof speeds up fair settlements.
- Peace of mind: You’ll know you’ve taken proactive steps before hurricane or storm season.
For commercial property owners in Dallas, Houston, Austin, or San Antonio, pre-loss inspections are especially valuable given the scale of potential storm damage and the complexity of claims.
Action Steps for National Preparedness Month in Texas
- Review your insurance policy—especially perils, exclusions, and deductibles.
- Confirm how your losses are valued—ACV or RCV.
- Schedule a pre-loss inspection with a qualified professional.
- Store inspection reports and policy documents in both digital and physical formats.
- Update coverage annually to reflect renovations, new equipment, or increased property values.
Final Thought
Preparedness in Texas isn’t just about supplies—it’s about financial resilience. By understanding your insurance policy, knowing whether it pays ACV or RCV, and securing a pre-loss inspection, you’ll be in the strongest position possible to recover after hurricanes, hailstorms, or other disasters.
Take action this National Preparedness Month so you’re ready when—not if—the next storm hits.
