Texas Insurance Regulation in 2026: What’s Changed and What’s Coming in 2027

The Texas insurance market has been through a year of significant regulatory change. New rules took effect, enforcement actions were announced, and groundwork was laid for the 2027 legislative session. Here’s what every Texas insurance professional needs to know.

New Enforcement: Price Optimization Is Now Banned

On August 24, 2026, Governor Greg Abbott directed the Texas Department of Insurance to take immediate action on rising property and casualty insurance costs. One of the first results: a formal ban on price optimization.

TDI Commissioner’s Bulletin B-0007-26 confirms that using price optimization in ratemaking or pricing is considered unfairly discriminatory and violates the Texas Insurance Code. Two policyholders with identical risk profiles cannot receive different premium increases based on factors unrelated to risk — such as whether they are likely to shop for a new policy or accept a higher price.

TDI has stated it will take enforcement action against companies that fail to comply.

TWIA Moves Forward With 2027 Legislative Recommendations

The Texas Windstorm Insurance Association’s Legislative Committee met on September 1, 2026, and agreed to recommend five topics for the association’s Biennial Report to the Texas Legislature.

The recommendations include:

• Making multidistrict litigation for TWIA lawsuits optional rather than mandatory
  
• Exploring public funding for FORTIFIED home construction and other mitigation programs
  
• Refining TWIA’s catastrophe funding structure under HB 3689
  
• Modifying the depopulation program to encourage more policy transfers to the private market
  
• Considering tort reform measures similar to those passed in Florida

TDI Releases Results of “Speak Up, Texas!” Campaign

TDI released the results of its statewide “Speak Up, Texas!” initiative on September 10, 2026. More than 200 Texans participated between March and July, generating 190 detailed responses.

The findings were clear:

• Homeowners insurance: Affordability and rate increases were the top concern, appearing in 43.7% of responses. Claims handling and service followed at 31.1%
  
• Auto insurance: Affordability and rate increases led at 35.8%, with claims handling at 22.6%

TDI will use this feedback to develop recommendations for lawmakers ahead of the 90th Texas legislative session, which begins in January 2027.

Tax Amnesty Program for Captive Insurers

The Texas Comptroller of Public Accounts is offering a temporary tax amnesty program through December 31, 2026, for nonadmitted captive insurance companies and their insureds.

The program waives penalties and interest and limits prior-year exposure to a four-year lookback period for qualifying taxpayers. The unauthorized insurance premium tax rate is 4.85% of gross premiums.

A New Insurtech Enters the Texas Market

Bamboo Insurance launched its Texas Essential Homeowner Program on September 4, 2026. The product offers flexible coverage options for homeowners in underserved markets, reflecting a broader trend of insurtech companies targeting state-specific gaps.

What This Means for Agents

2026 has been a year of significant regulatory activity in Texas insurance. Price optimization is now banned, TWIA is pushing for legislative reforms, TDI is gathering consumer input, and the 2027 legislative session is shaping up to be a major one for insurance issues.

Agents should stay current on these developments. Clients will have questions about rate increases, policy non-renewals, and new consumer protections. Understanding the regulatory landscape helps agents serve clients effectively and protect their own careers.

Time2Renew offers TDI-approved continuing education courses covering ethics, legal updates, and emerging risks — all online and self-paced. Stay compliant and informed with courses designed for busy Texas insurance professionals.

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