Texas Insurance Regulation Update: Price Optimization Ban and New FORTIFIED Roof Discounts
Two major regulatory changes are reshaping how Texas insurers price homeowners policies — and agents need to understand both.
Price Optimization Is Now Banned
On August 24, 2026, Governor Greg Abbott directed the Texas Department of Insurance to ban “price optimization” — the practice of setting premiums based on customer behavior rather than risk. TDI issued Commissioner‘s Bulletin B-0007-26 confirming that using price optimization in ratemaking is considered unfairly discriminatory and violates the Texas Insurance Code.
What this means: Two policyholders with identical risk profiles cannot receive different rate increases based on factors unrelated to risk — such as whether they are likely to shop for a new policy or accept a higher price. The ban applies to all TDI-regulated insurance products, including auto, homeowners, and commercial lines.
TDI Commissioner Amanda Crawford said the department will pursue enforcement action against companies that fail to comply.
New FORTIFIED Roof Premium Discounts
On September 16, 2026, TDI issued Commissioner’s Bulletin B-0008-26 encouraging all property and casualty insurers to develop meaningful premium discounts for homeowners who invest in loss mitigation.
What this means: Homeowners who build or retrofit homes to resilient standards — such as IBHS FORTIFIED Home™, impact-resistant roofing materials, or wildfire protection — should receive premium discounts that reflect the reduced risk they create.
TDI reminded insurers that under Insurance Code Chapter 2251, rating plans may differentiate between standard structures and resilient properties. Companies that introduce new discounts must file through SERFF.
Why This Matters for Agents
These changes directly affect how you advise homeowner clients. When a client asks about premium increases, you can explain that rates must now be based on risk — not on how likely they are to shop around. And when a client is considering roof upgrades or storm-resistant construction, you can point to the new FORTIFIED discount pathway.
Agents should also stay current on TDI bulletins. More administrative actions are expected as TDI delivers recommendations to the Governor‘s office ahead of the 2027 legislative session.
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