5 Common Life Insurance Mistakes Families Make

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By: Michelle Wolfe, Personal Lines – Sales Executive

The infamous kitchen junk drawer. It’s where all of the bits, bobs, and things that don’t quite have a place end up. You plan to come back, sort through the items, and put them where they belong. But it always ends up at the bottom of your to-do list. 

Life insurance tends to be like that. You bought a policy, or maybe planned to when you got married, had a child, bought a home, or started a new job… and life gets busy.

But your family’s financial situation doesn’t stay the same. The coverage that made sense to get five years ago may not be enough for your family today. 

At Grimes Insurance Agency, our agents see this when families revisit their policies. After a major life change, they discover their coverage, beneficiaries, or policy details no longer match their circumstances. However, with 78 years of insurance experience, our team doesn’t let it stay that way.

By the end of this article, you’ll understand five common life insurance mistakes families make and what you can do to avoid them. 

Life Insurance Mistake #1: Waiting to Update Your Policy

A new baby, mortgage, job, or health diagnosis can all affect how much life insurance you need. 

The problem is that most families don’t think about reviewing their coverage when these things happen. They keep the same policy because nothing is inherently wrong with it, until they realize it no longer fits their situation… and it’s too late. 

We’ve had clients come to us after developing a serious health condition (or sometimes more than one) looking for coverage they wish they’d secured years earlier. By that point, it’s not a matter of a higher premium; it can mean no carrier is willing to offer a policy at all. 

Health and age are the two biggest factors in what you’ll pay, and both only move in one direction over time. The best time to get covered is before you need to. 

How often should you review your life insurance policy?

Whether you’ve purchased a term or whole life policy, you should aim to regularly review your policy with your agent once a year. You should especially consider updating your policy when:

  • You get married or divorced
  • You have a child
  • You buy or refinance your home
  • Your income changes significantly
  • You take on substantial new debt
  • Your children become financially independent
  • Your business or financial responsibilities change
  • Your term life insurance policy is approaching its expiration date

You don’t necessarily need to change your policy every time something in your life changes. However, you should at least routinely check to ensure the coverage still matches your situation. 

If you’re specifically watching a term policy approach its expiration date, read What Happens When You Outlive a Term Policy? to learn what to consider before the deadline.

Life Insurance Mistake #2: Underestimating How Much Life Insurance Your Family Needs

$250,000 sounds like enough… but $500,000 feels more comfortable… Is there a “right” number?

We get it. Deciding on a reasonable amount for life insurance coverage feels like throwing spaghetti at the wall and seeing what sticks. 

But choosing a round number doesn’t tell you whether your family would actually have enough money to maintain their life without major financial disruption. 

How do you calculate your life insurance policy coverage?

The right amount of life insurance depends on what your family would actually need if your income disappeared. 

Consider expenses and responsibilities such as: 

  • Mortgage or rent payments
  • Other outstanding debts
  • Lost income
  • Childcare
  • Education expenses
  • Everyday living expenses
  • Final or end-of-life expenses (funerals, medical bills, burials, etc.)

For example, a family with a large mortgage, young children, and one primary income may have very different coverage needs compared to an empty-nest couple with a nearly paid-off home. 

Comparison of two families looking for life insurance. Image shows Family A as a family of four with young children, a large mortgage, and one primary income. Family B is shown as empty nesters with adult children, a paid off house, and dual income. The image is meant to depict the example previously mentioned above.

For more help calculating an accurate coverage amount for your family, read How Much Life Insurance Do You Actually Need? You’ll learn how to use your family’s financial obligations and a handful of formulas to estimate your coverage.

Life Insurance Mistake #3: Not Understanding Who Owns Your Life Insurance Policy

One of the most common details we’ve seen clients overlook is the difference between the policy owner, insured person, and beneficiary. Keep in mind that the person who owns the policy may not always be the person who is insured. 

For reference:

  • Policy owner: The only party with rights to the policy (can make policy changes, terminate the policy, borrow against cash values, etc.)
  • Insured person: The person whom the life insurance policy covers.
  • Beneficiary: The person(s) who receive the death benefit amount when the insured person dies.

Image depicts a text example of life insurance roles. Text reads: (Policy Owner) Richard takes out a life insurance policy on his wife, Emily. (Insured) Emily is the person the life insurance policy insures. If she dies, the policy is paid out. (Beneficiary) Lorelai, their daughter, is the beneficiary. She will receive the cash payout when Emily dies.

We’ve seen this scenario play out directly: someone takes out a policy on a spouse, both people contribute to the premium for years, and then the relationship ends. The person who isn’t the owner assumes they can update the beneficiary since they’ve been paying into it too. However, insurance companies look at ownership, rather than payment history. Without being the owner, there’s no way to make that change. 

Knowing who owns your policy and who is listed as the beneficiary becomes especially important when your family circumstances change. 

Life Insurance Mistake #4: Not Planning for a Minor Beneficiary

On the topic of policy roles, parents often assign their children as beneficiaries of their life insurance proceeds. The issue, however, is that most states do not allow insurance companies to issue payouts to minors. 

So, naming a child as your beneficiary creates an important question:

Who will manage the money if the child isn’t legally able to receive and control it directly?

Instead of naming a minor and assuming the details will work out, there are measures you can take to ease the payout process. If you plan to list your young children as beneficiaries, ask your insurance agent and legal/financial professionals about your options. A few common methods worth discussing include:

Image shows the relationship between trusted custodian and beneficiary. Text box reads below: Child beneficiary will receive the insurance payout from Trusted Custodian when child is of age (18 or older)

We recently worked with a single mother who wanted coverage not just on herself, but on each of her children. Her priority was making sure that if something happened to her, there would be someone in place — both to receive the funds and to actually use them for her kids, not just hold the title of beneficiary.

That’s the conversation every parent with minor children needs to have: not just how much coverage, but who’s responsible for it if you’re not there. 

Life Insurance Mistake #5: Leaving Information Off Your Life Insurance Application

There’s a lot that goes into purchasing life insurance– especially when it comes to your application and medical underwriting. Factors like your age, gender, occupation, and health history are all considered when you apply. 

And it’s tempting to think a medication, health condition, or old diagnosis isn’t important enough to

Graphic with elements depicting which factors affect life insurance premiums. Factors read: age (depicted by a calendar icon), gender (depicted by the outline of a male and female stick figure), occupation (depicted by a briefcase), and health (depicted by a heart)

 mention when applying. But leaving information off your application can create problems during the underwriting process.

Why is medical history important for life insurance?

The underwriting process can affect both your eligibility for coverage and the premium you’re offered. 

And all of the information your insurer (or the underwriter) asked you about? These details help insurance companies determine the perceived risk of insuring you.

Do you smoke? Does heart disease run in your family? Have you been diagnosed with any chronic illnesses? If so, you may be considered a higher risk. And the riskier you appear, the higher your premiums might be. 

If information comes to light that wasn’t included on the application, it can affect the underwriting decision, premium, or how long it takes to complete the process. 

We’ve seen this happen even to clients who aren’t hiding anything on purpose. 

One client was in a serious car accident and, during treatment, was prescribed medication she never actually filled or took. She didn’t think to mention it on her life insurance application months later — it wasn’t something she considered relevant. But because it was in her medical records, the insurer flagged it during underwriting, and she had to go back and prove she’d never filled the prescription before her policy could move forward. Even information that feels minor or unrelated can surface, and it’s easier to disclose it upfront than to untangle it after the fact. 

The best approach is to answer the questions as accurately as you can and ask your agent if you’re unsure whether something needs to be disclosed.

Your goal isn’t to tell the insurer only what you think they want to hear. It’s all about giving the insurer an accurate picture of your health and circumstances from the beginning.

Avoid These Life Insurance Mistakes Before They Become Problems

Life insurance is easy to put on the back burner, but your coverage should keep pace with the changes in your life. Marriage, children, a new home, or a changing income can all be reasons to take another look at your policy. 

The good news is that avoiding these mistakes doesn’t necessarily mean changing your policy. It starts with understanding whether your coverage, policy ownership, beneficiaries, and application information still reflect your family’s current situation. 

Now that you know what to look for, review your current policy and consider whether anything in your life has changed since you first purchased it. If you’re unsure of what type of insurance you need, start by learning the differences between term and life insurance policies and which one might be the best fit for you.  Or, give our office a call to connect with a life insurance agent to discuss your options. 

At Grimes Insurance Agency, we’ve helped families navigate these questions for 78 years. If your review raises questions about your coverage or beneficiaries, our agents are here to help you understand your options.

4 Common Contractor Insurance Gaps

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By: Ryan Rogers, Commercial Lines – Executive

Executive Summary:

Contractor insurance gaps can develop when your policy no longer matches the way your business operates. Four common problems include inaccurate information on your insurance application, taking on work outside your primary trade, relying on uninsured subcontractors, and overlooking workers’ compensation exposure. Reviewing these areas before a claim can help you identify potential gaps while there’s still time to address them.

Have you ever been on a leaky boat? Imagine stepping into a boat that looks perfectly sturdy on land. You expect it to keep you dry… until it hits the water and you find yourself in trouble. Soaked and sinking, you realize a sneaky little hole has left you exposed.

Contractor insurance gaps paint the same picture. What might look like a solid business policy can turn out to be full of holes, leaking coverage where (and when) your company needs it the most.

At Grimes Insurance Agency, we understand how the details of a contractor’s operations can affect coverage, eligibility, and cost. With over 75 years of commercial experience, we’ve seen how seemingly small details can create significant problems when they’re not addressed before a claim. 

In this article, we’ll look at four common contractor insurance gaps, what causes them, and what you can do to identify them before they become a problem.

Note: This article focuses primarily on general liability and workers’ compensation exposures. A complete commercial insurance policy may also include commercial auto, property, tools and equipment, and other coverages.

1. What Happens if Your Contractor Insurance Application is Inaccurate?

One of the first places a coverage gap can develop is before your policy is even issued. 

When you apply for contractor insurance, your carrier needs an accurate picture of your business to determine what it is willing to insure and how to structure your policy. That’s why many contractor and roofer policies require a supplemental application before coverage is bound.

Contractor Supplemental Application Example:

Screenshot of the first page of an example contactor supplemental application page.
Screenshot of the first page of an example contactor supplemental application page.
Screenshot of the second page of an example contactor supplemental application page.
Screenshot of the second page of an example contactor supplemental application page.
Screenshot of the third page of an example contactor supplemental application page.
Screenshot of the third page of an example contactor supplemental application page.
Screenshot of the fourth page of an example contactor supplemental application page.
Screenshot of the fourth page of an example contactor supplemental application page.
Screenshot of the fifth page of an example contactor supplemental application page.
Screenshot of the fifth page of an example contactor supplemental application page.

These applications can ask about details such as: 

  • The types of work you perform
  • Whether you work on new construction or existing structures
  • How often you use subcontractors
  • Whether subcontractors carry their own insurance
  • The size and scope of your projects
  • Your estimated gross sales and payroll

A supplemental application is more than paperwork. It lays the foundation for the coverage and pricing you receive. The information you provide helps your insurance carrier understand the risk they’re being asked to insure. 

What happens when the information isn’t accurate?

Sometimes an inaccurate answer is an honest mistake and can be corrected by talking with your agent. Other inaccuracies may be identified during the annual insurance audit, which reviews your business information and actual exposures.

 However, waiting until the annual audit to make a change can end up being costly. 

One of the most common mistakes we’ve seen happen is misestimating gross sales or payroll estimates. If your actual numbers are significantly higher (or lower) than your estimates, you could owe additional premium when those numbers are reviewed. 

An example: a costly underestimation

In one prior roofing client example, the company estimated their annual sales at $6,000,000. Using this number as a factor, their original premium was rated at $50,000. 

However, their sales nearly doubled their estimate, producing $11,000,000 in gross sales. After the yearly audit, they were billed an additional $39,000 in premium to settle the difference.

Sometimes, your business simply changes after the application is completed. And oftentimes, the change is for the good. Either way, the end result can be the same: your policy might not be reflecting the business you’re actually running. 

How can you avoid this gap?

Complete the application based on how your business actually operates, not how you expect it to. 

Before binding coverage, review your answers carefully. Make sure your work, subcontractor use, project types, sales, and payroll estimates accurately describe your business.

When you’re unsure how to answer a question, ask your agent to walk through it with you before submitting. Client education and understanding are an essential part of preventing coverage gaps. 

If you’re ever unclear about your supplemental application information, or have additional insurance questions, feel free to give us a call, and Grimes Insurance Agency can help you sort it out. 

2. Can Taking on Different Types of Work Create a Contractor Insurance Gap?

As a contractor, you probably consider yourself according to your primary trade: 

“We’re a siding contractor.” “We’re a roofer!” “We’re a concrete contractor.”

But what happens when you start taking on work outside of that category? 

A siding contractor, for example, may occasionally accept roofing, gutter, or exterior projects. That flexibility can help your business grow… but it can also create an insurance issue if your policy only reflects your primary trade.

Adding a higher-risk service can affect your classification, eligibility, or premium—even if that service represents only a small portion of your business. 

Why can mixed-trade work create coverage problems?

Insurance carriers use classifications to evaluate the risks associated with different types of contracting and commercial work. These look like numbered “class codes” assigned to your business, based on the type of work you offer. 

Image depicting a green background with three images of three different storefronts. #1 has a saw and hammer logo above it, titled "residential roofing" and lists its class code (98678) underneath it. #2 has a dropping faucet logo, with "commercial plumbing" and its class code (98482) listed below it. #3 has a logo with hair tools, with the title "barber shop" and its class code (10113) underneath.

For example, a business may earn most of its revenue from siding, but occasionally take on roofing work. Roofing presents a different risk than siding, so your insurance carrier may need additional information before determining how that work should be classified and rated. 

Want a more in-depth understanding of class codes? Read our Guide to Comparing Contractor Insurance Quotes to learn more about why these classifications matter.

How can you avoid this gap?

Tell your agent when your services change, even if the new work is occasional. Before adding a service, ask how it may affect your existing coverage, classification, eligibility, and premium.

If you regularly perform significantly different types of work, you may also want to discuss your business structure with your insurance agent and other professional advisers. Separate entities may make sense in some situations, but they are not appropriate for every contractor. 

3. Does Your Contractor Insurance Account for Your Subcontractors?

Subcontractors can be helpful additions for your business operations. But hiring another company to perform work doesn’t automatically eliminate your exposure.

Imagine you hire a subcontractor who damages a customer’s property. Or their work contributes to a claim. Or, maybe they end up injured during a project.

You might expect their subcontractor insurance to respond, but do you actually know what coverage they carry?

The thing is, your general liability policy does not necessarily provide the same protection regardless of whether a subcontractor has their own insurance. Some policies may provide coverage in certain situations, while others may exclude work performed by uninsured subcontractors or apply different conditions. 

Your policy’s language controls how your coverage responds to subcontractor-related exposures.

Why is this a common contractor insurance gap?

Texas is different from many states because not all contractors are required to hold a license or insurance. Whether a contractor needs a license can depend on the trade and the location where they work. Texas-specific licensing information should be reviewed alongside your own insurance requirements.

This can make it especially difficult to understand who you’re hiring, what insurance they carry, and how your own policy responds if they don’t have coverage.

What should you check before hiring a subcontractor?

Before hiring a subcontractor, consider:

  • Does your contractor policy require specific insurance?
  • Does the subcontractor carry general liability insurance?
  • Does the subcontractor carry workers’ compensation insurance?
  • Does your policy address uninsured subcontractors?
  • What documentation should you collect?

Maintaining up-to-date documentation, like certificates of insurance (COI), is the best way to stay on top of these details before gaps happen. A certificate of insurance is the document you provide to customers, project owners, or contractors (like yourself) to prove your business carries the required insurance coverage.

Other helpful records to keep on file include:

Titled image "business should maintain records such as:" including a bulleted list, reading: maintenance records, equipment information, incident reports, photos of damage, receipts, and contracts

The goal isn’t simply to collect a certificate and check a box. It’s to understand where responsibility falls if something goes wrong.

If you regularly rely on subcontractors, talk with your agent about how your specific policy treats their work before you need to rely on that coverage.

4. Could You Have a Workers’ Compensation Insurance Gap?

It’s important to understand that not every insurance gap involves liability. Workers’ compensation can create another significant area of exposure.

Texas has different standards from many states when it comes to private employer workers’ compensation coverage. In fact, most private employers in Texas aren’t required to have workers’ compensation coverage. However, choosing not to subscribe can create different legal and financial exposures if an employee is injured. 

The fact that workers’ compensation may be optional doesn’t mean the decision has no consequences.

How can you address this potential gap?

One option is to add workers’ compensation to your insurance policy. It may be an important way to protect your business, employees, and operations, but every business has different circumstances.

Talk with your insurance agent about your options and the exposures your company may face before deciding whether workers’ compensation is appropriate for your business.

How does your claims history affect your workers’ compensation costs?

If workers’ compensation is the right choice for your company, your claims history can also affect your premium costs through your experience modification factor (EMOD).

Graphic depicting the EMOD range, reading: on the left, 0.75 (lower premium), in the middle, 1.0 (average), and on the right, 1.50 (higher premium).

In simple terms, your EMOD is a scaled value that shows how your business compares to others within the industry based on your workplace losses. A higher EMOD increases your premium. A lower EMOD decreases it.

 

Interested in learning how to lower your company’s EMOD score? Read about How Much Contractor Insurance Costs to learn 4 ways to keep your score in check.

What Should You Do if You Think Your Contractor Insurance Has a Gap?

Contractor insurance gaps often develop when your business changes but your insurance doesn’t change with it. 

Maybe the application doesn’t accurately describe your business. Maybe you’ve added work since the policy was issued. Or maybe you’ve assumed coverage where your business’ policy simply doesn’t include it.

Each one can create an exposure that’s difficult to recognize until something happens.

If your business has changed since your last policy review, you don’t have to wait for renewal (or a claim) to find out whether your coverage still fits. Give our team a call, and we’ll connect you with an agent to review your current coverage. 

At Grimes Insurance Agency, we can help you identify potential gaps and determine whether your policy reflects the business you’re actually running. Unsure if Grimes may be the right fit? Learn Why West Texas Contractors Trust Grimes with their business insurance needs. Even if you don’t work with our team, we want your business to be well equipped with the right coverage.

How to Look for the Best Roofing Business Insurance Policy

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By: Ryan Rogers, Commercial Lines – Executive

If you’re a roofing company owner shopping for commercial insurance, you probably want a simple answer: which policy gives me the best protection without paying for coverage I don’t need? 

The problem is that there isn’t a single insurance carrier or policy that’s automatically “best” for every roofing company. Exclusions, coverage limitations, and/or coverage requirements make all the difference in what you actually pay and what your policy covers.

At Grimes Insurance Agency, we currently help insure several roofing companies, giving us firsthand experience with the unique coverage considerations roofers face. A policy that looks inexpensive can become very expensive when it doesn’t cover the work actually being performed. 

Rather than fitting every roofer under the same type of policy, the right coverage depends on the work their business performs and what it needs.  

The best commercial insurance for a roofing company: 

  • Doesn’t leave critical gaps in coverage
  • Accurately classifies the operations performed by your business
  • Covers the work your company actually performs
  • Considers your company’s current and future growth

In this article, we’ll break down these four areas, so you know what to look for when comparing or renewing a roofing business insurance policy.  

1. The Best Roofing Insurance Doesn’t Leave Room for Coverage Gaps

If it isn’t already obvious, roofing is a risky business. According to USA Business Insurance’s latest review, roofing contractors are considered one of the riskiest trades to insure for general liability. However, your risk extends beyond the physical labor involved in installing or repairing a roof. 

This makes certain commercial policies nonnegotiable to properly cover your business:

Image lists the three important commercial policies for roofing businesses. Includes general liability, workers' compensation, and business auto liability

Why is general liability important for roofing companies?

Roofing carries two main types of risk on nearly every job, and general liability is what protects your business against both.

Water damage

If you’ve been in the roofing business for any length of time, it’s no surprise it’s one of the most common claims roofers face. 

Even a small installation issue, like flashing that isn’t properly tucked under siding, can let water work its way behind the roofline and cause a sneaky (and costly) amount of damage. 

Third-party property damage 

Did equipment fall off the roof and dent a neighbor’s car? Did materials slip and damage a neighboring house? 

Without appropriate liability coverage, those costs fall entirely on your business. That’s what makes it a foundational policy for your company to have. 

Why is workers’ compensation important for roofing companies?

Texas doesn’t require most private employers to carry workers’ compensation insurance, but choosing not to carry it doesn’t eliminate the risk of an employee injury. 

Without it, you’re stating your business will be a non-subscriber for Workers’ Compensation coverage, but this doesn’t relinquish responsibility in the event an employee is injured in the scope of work performed for your business. An injured employee may have other avenues to seek compensation from your business, depending on the circumstances.

Subcontractors can be another blind spot. Some policies cover uninsured subcontractor labor; others exclude it outright. This is especially important to understand in Texas, where not all contractors are required to carry insurance or hold a license to take on work. 

If you haven’t confirmed which applies to you, you may be assuming coverage that isn’t there. To verify how subcontractors are covered under your policy, consider meeting with your insurance agent to discuss your specific policy. 

Why is business auto liability important for roofing companies?

If your roofing company owns, leases, or regularly uses vehicles for business, business auto liability helps protect your company when one of those vehicles is involved in an accident that causes bodily injury or property damage to someone else.

For a roofing company, that could mean an accident involving a truck hauling materials to a job site, a company vehicle driven between projects, or another vehicle being used for business purposes. 

What should roofing companies look for in a business auto liability policy?

When reviewing your commercial auto coverage, consider:

  • Which vehicles are covered?
  • Who is allowed to drive them?
  • How are the vehicles being used?
  • Are employees using personal vehicles for business?

The important thing is to make sure your business’ auto coverage reflects how your roofing company actually uses its vehicles. A policy that looks adequate on paper may not provide the protection you expect if your vehicles, drivers, or business use aren’t properly accounted for. 

2. The Best Roofing Insurance Accurately Classifies Your Work

One of the first things to look at is whether your policy accurately describes the work your company performs. 

If you do both residential and commercial roofing, both types of work need to be properly accounted for. Even if one represents a much smaller percentage of your business, it still affects how your company is classified. 

Why does it matter how my roofing business is classified?

The simple answer: your classification helps determine how your business is rated and what premium applies to your operations. Let’s explore how. 

Every business is given a number called a classification (or class) code. These codes are used by insurance companies to group businesses and jobs by their levels of risk. Plumbing companies, electrical contractors, roofing companies, and even barber shops have their own codes. 

Image depicting a green background with three images of three different storefronts. #1 has a saw and hammer logo above it, titled "residential roofing" and lists its class code (98678) underneath it. #2 has a dropping faucet logo, with "commercial plumbing" and its class code (98482) listed below it. #3 has a logo with hair tools, with the title "barber shop" and its class code (10113) underneath.

Each business also has additional codes specific to the type of commercial insurance they have. Let’s bring back the residential vs. commercial roofing example and look at general liability insurance.

If you’re a roofing company, you may have seen class codes similar to these:

Residential roofing (three stories and under)  Commercial roofing (or residential over three stories)
General Liability Classification Code: 98678 98677

Further, if your company performs both residential and commercial roofing, your policy would reflect both codes. 

A misclassification can affect how your business is rated, which is why it’s important to make sure your class code(s) accurately reflect the work your company performs.

Misclassification can also leave you exposed in the event of a claim. If the insurance company didn’t have the commercial class code on your policy, but an event occurs on a commercial job resulting in a claim, you might not have coverage if you’re not classified correctly on your insurance policy. 

If your business has expanded into commercial roofing, started working on taller buildings, or added another type of operation, make sure your agent knows.

3. The Best Policy Covers the Roofing Work You Actually Do

A policy can look great on paper… until you find an exclusion that applies directly to your work. Then, you’re left uncovered for tasks you do every day.

Two of the most common exclusions roofing companies face include:

  • Building story or height limits: Some policies may restrict roof work performed above a certain height
  • Hot work exclusions: Restrict labor involving torches or heat (often used during roof flashing)

How do I know what to exclude or include on my business roofing policy?

It all boils down to being transparent about what your business does. 

Let’s say your roofing company doesn’t regularly offer hot work. Instead of torch-down roofing, you offer a different method for your main service. However, you offer it for certain roofing projects on occasion. 

Even if torch-down roofing isn’t your main operation, you should disclose additional services to your insurance agent to determine whether your policy provides the coverage your business actually needs. 

 Before you choose a policy, ask:

  • Does the policy list any exclusions or limitations?
  • Do those limitations match the buildings my company actually works on?
  • Are there available endorsements to add protections to my policy?
  • Does the policy address all of the roofing operations my company performs?

At the end of the day, the best policy isn’t the one with the longest list of benefits. It’s the one that doesn’t exclude a critical part of your operation.

4. The Best Roofing Policy Makes Sense for Your Company’s Growth

Roofing companies can have significant swings in revenue from one year to the next. Based on how your policy is rated, though, those swings can create major surprises during your next insurance audit.

What exactly is an insurance audit? Great question! Watch this video to learn about insurance audits, what to expect, and how your business can prepare for one.

Roofing policies are typically rated one of two ways:

  • Based on your gross payroll
  • Based on your gross sales

Graphic listing gross sales vs. gross payroll definitions. Text reads, gross sales: company's total revenue from goods or services before deductions, gross payroll: company's total compensation paid to employees before withholding and taxes.

A gross payroll-based quote often comes in lower, but can change more often. A stronger year, a few new hires, or some overtime can push your payroll up dramatically. 

Generally, gross sales are a steadier number to build a policy around. However, it’s still important to remain mindful (and realistic) about your company’s capability. We’ve seen how it can easily backfire firsthand.

An example: a costly underestimation

Based on a prior example, a roofing company client estimated their annual sales at $6,000,000. Using this number as a factor, their original premium was rated at $50,000. 

However, their sales nearly doubled their estimate, producing $11,000,000 in gross sales. After the yearly audit, they were billed an additional $39,000 in premium to settle the difference.

How can you avoid a surprise audit bill?

As much as we wish it were possible, you can’t always predict how a fiscal year will play out. However, some of the best ways to keep audit surprises to a minimum include: 

  • Consistent communication with your agent
  • Keeping an eye on your finances

As things change within your business, make them known to your agent. Updating your gross sales or payroll, or adding new operations as your business changes, can spread those costs over time, rather than surprising you with a single large bill. 

Have you made any recent changes to your business? Contact Grimes Insurance Agency to speak with an agent about amending your commercial coverage.

Whichever option you decide to base your premium on, verify that it makes sense for your company’s growth. Consider where your company currently is and where you can realistically see yourself by the end of the year. 

To dive deeper into what affects your commercial policy rates, read about how much contractor insurance costs.

How Do You Find the Best Roofing Business Insurance?

Finding the best roofing insurance isn’t about choosing the carrier with the cheapest quote or the longest list of coverage options. The right policy should accurately reflect your roofing operations, protect you from the risks you actually face, and make sense for the way your company is growing.

Before choosing or renewing your policy, review four key areas:

  1. Coverage gaps: Does your policy provide the coverage your business needs?
  2. Classification: Does your policy accurately describe the work your company performs?
  3. Exclusions: Are there limitations that could leave you uncovered for work you actually do?
  4. Growth: Does the way your policy is rated make sense for your expected sales or payroll?

You shouldn’t have to discover a coverage gap or a major premium adjustment after something goes wrong. Since 1948, Grimes Insurance has helped roofing companies look beyond the price of a policy and understand how their operations, classifications, exclusions, and growth can affect their coverage.

If your roofing company has changed, grown, or you want to know whether your policy still fits, Grimes Insurance Agency is available to help review your commercial coverage. Give our office a call to connect with an agent and review your current coverage. Or, if you’re ready to shop your policy, request a business insurance quote and explore your best options with our team.

A Guide to Comparing Contractor Insurance Quotes

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By: Ryan Rogers, Commercial Lines – Executive

If you’ve ever received multiple contractor insurance quotes and the premiums look nearly identical, how do you know which one is right for you? Price is easy to compare, but it doesn’t tell you whether two policies provide the same coverage.

To most policyholders’ surprise, price alone rarely tells the whole story. Two quotes can carry nearly identical premiums and still protect one business dramatically better than the other. So, what else are you supposed to look for? It’s a question we’ve helped answer for decades. 

At Grimes Insurance Agency, our commercial lines team has helped contractors compare their options for over 78 years. We currently represent several commercial contractors and are dedicated to educating clients about the right coverage for their business.

By the end of this article, you will know:

  • What to look for when comparing contractor quotes
  • How to know which contractor coverage is the best fit
  • What questions you should ask when comparing

A quick note before we dive in: everything below focuses on general liability coverage. A full commercial insurance package for a contracting business typically also includes commercial auto, property, workers’ comp, and sometimes umbrella coverage – each with its own set of considerations. 

What Should I Look for When Comparing Contractor Insurance Quotes?

There’s more to your insurance policy than price, especially when insuring your contractor business. The thing is, businesses are built differently. While you may be in a similar contracting market, your business is unique to you. In the same vein, your policy should be, too. 

What your policy covers should be specific to the work you do. From our experience with local contractors, there are four items you should pay attention to when comparing your insurance quote:

  1. Your company’s classification codes
  2. How your company’s policy is rated
  3. The exclusions listed on your policy
  4. How your policy includes subtractors

Let’s break each of these down together.

1. Verify your insurance classification codes

A classification (often shortened to class) code is a number used by insurance companies to group businesses and jobs by their levels of risk. 

Think about it like a library; There are thousands of books all organized by genre, author, and title. The same idea applies to insurance classification codes. Contractors, barber shops, and insurance agents are all classified differently. 

Image depicting library example mentioned above for commercial class codes. Image includes three books. Each book includes an example commercial class (residential roofing, commercial plumbing, and barber shops) with their corresponding class code along the spine. The photo is for example purposes.

Why do class codes matter?

Class codes can drive your premium rate. Specifically for general liability insurance, it can also affect your eligibility for a policy. 

Think about it this way: a plumber’s class code carries a lower rate than a roofer’s simply because roofing naturally has a greater risk. Even something that sounds low-risk, like window cleaning, can jump into a much higher-rated class once the work goes above two stories. 

Who assigns classification codes?

Because not all states rely on the same kind of classification system, it can vary. However, a common system insurers use is the National Council of Compensation Insurance (NCCI).

There are also specific classification codes for different types of commercial insurance. Meaning, you often have more than one class code to look for. This article is specifically discussing general liability. However, other types of commercial insurance that use specific class codes include: 

  • Workers’ compensation
  • Commercial auto
  • Commercial property

Class codes can get more complicated when you look beyond general liability. To understand how classification codes affect different types of commercial insurance, USA Business Services Inc. breaks down how these codes are used across different policies in its guide to commercial class codes.

How can your contractor business be misclassified?

You could be accidentally misclassified in a few different ways. Sometimes the wrong information gets passed along, or maybe your underwriter made an assumption based on incomplete details. 

Either way, the fix is the same: ensure that your insurance agent has a full, accurate picture of what your business does before a quote is ever built. If you’re insured as a roofing contractor, but also offer gutter repair services, it’s important to communicate that with your agent so that your class codes reflect correctly in your quoted premium. 

How do I find my classification code?

You might look at your contractor’s quote and realize that you don’t even know your business’ class. You’re not the only one. 

There are a handful of websites where you can search for your classification based on your industry and the type of commercial insurance you’re purchasing. Consider reviewing your class code using one of these tools:

While these tools can be a helpful resource, always verify your classification information with your insurance agent before assuming your codes are correct.

2. Understand how your contractor policy is rated

Contractor policies are typically rated one of two ways:

  • Based on your gross sales
  • Based on your payroll

Graphic listing gross sales vs. gross payroll definitions. Text reads, gross sales: company's total revenue from goods or services before deductions, gross payroll: company's total compensation paid to employees before withholding and taxes

On paper, a payroll-based quote often comes in lower. However, in practice, payroll tends to be far more volatile than gross sales. A stronger year, a few new hires, or some overtime can push your payroll up dramatically. 

That difference is more important than you might think, and it typically gets caught (and billed for) when annual audit time comes around. 

In our client experiences, gross sales tend to move less dramatically year to year, making it a steadier number to build a policy around. If two quotes look similar, but one is based on payroll and the other on gross sales, don’t assume they’re apples to apples. The payroll-based policy may look cheaper today and cost you more down the road in unexpected premium jumps. 

Interested in learning more about how these rates affect your commercial policy? Read How Much Does Contractor Insurance Cost? to understand how your policy can be calculated.

3. Carefully review the exclusions listed in your policy

This is the step where quotes that look nearly identical can turn out to be worlds apart.

What is an exclusion?

Exclusions are the specific situations or types of work a policy won’t cover. If a loss were to happen because of the excluded cause, your insurance provider would not pay for the incident. This information is often buried deep in the pages of a policy most people never read. 

An exclusion example: A local roofing company

A recent client insuring their roofing company was paying around $6,000 a year for a policy that excluded “hot work”. Hot work is any labor involving torches or heat, which many roofers use to melt tar or adhesive when securing roof flashing, even if torch-down roofing isn’t their main service. 

When their crew accidentally started a fire that spread to a garage, the total uncovered claim cost roughly $89,000 (ouch!). Because hot work was excluded from their policy, none of the damage was covered, causing the business owner to pay the entire amount out of pocket. 

That’s the risk of chasing the lowest number. Most contractors don’t realize what they may be giving up in coverage just to get to a lower price. 

4. Ask about your policy’s subcontractor usage

If your business relies heavily on subcontractors, this is one of the most important (and commonly overlooked) pieces of a quote.

Some policies will cover labor performed by uninsured subcontractors. Others will exclude it outright. If you’re using subs and haven’t confirmed which category your policy falls into, you could be assuming coverage that simply isn’t there. 

This is especially relevant in Texas, where not all contractors are required to carry insurance or hold a license to take on work. It’s common, which means it’s worth a direct conversation with your agent about how your policy treats uninsured subcontractor work. 

How do I know which contractor insurance quote is best?

Once you’ve looked beyond the premium, you can start comparing the quotes based on how well each one fits your business.

Instead of asking, “Which quote is cheapest?” begin to ask, “Which quote gives my business the coverage it needs at a price that makes sense?”

A simple way to do this is to put your quotes side by side and look for meaningful differences, like this:

Quote 1 Quote 2
Annual premium $5,400 $5,900
Class codes Roofing Roofing + gutter work
Rating basis Payroll Gross sales
Liability limits $1 million/ $2 million $1 million/ $2 million
Exclusions Hot work No hot-work exclusion
Subcontractor provisions Excludes certain uninsured subcontractor work Provides coverage for eligible subcontractor work

Quote 1 is $500 cheaper. But if the contractor performs hot work and regularly uses uninsured subcontractors, the cheaper quote may not provide the coverage their business actually needs. On the other hand, if the two quotes provide essentially the same coverage and one costs significantly more, it’s reasonable to ask the agent why.

So, is quote 1 or 2 the best? Your answer: The better quote is the one that appropriately covers the contractor’s actual operations and needs. 

The goal isn’t necessarily to find a quote that wins every category. It’s to identify why the quotes are different and decide whether those differences matter to your business.

Learn more about how you can find the best insurance for your contracting business:

What Questions Should You Ask Before Choosing a Contractor Insurance Policy?

If you’re having trouble determining how two quotes differ, take them back to your agent and ask them to explain the differences. 

Here are a few questions to start with:

  • Why is one quote more expensive than the other?
  • Are both quotes using the same classification codes?
  • Are there any coverage differences I should be aware of?
  • Is either quote excluding work that my business performs?
  • How does each policy treat subcontractor labor?
  • Is there anything about either quote that you would recommend I change based on my business?

It’s important to remember that you don’t have to do the comparison alone. At Grimes Insurance, your agent is with you at every step of the process. If you find yourself confused between quotes, call our office, and we can help explain your options and which may be the best fit for your business.

The Best Contractor Insurance Quote Isn’t Always the Cheapest

When you first receive a handful of insurance quotes, the premium is probably the number you’ll notice first. But the real question is what your business is getting for that premium. 

Before you choose your contractor insurance policy, put your quotes side by side, identify the differences, and ask your agent to explain anything you don’t understand. 

If you’re still comparing contractor insurance options and would like to walk through them with an agent, give us a call, and we’ll connect you. At Grimes Insurance, we can help you understand the differences between your options and determine which coverage may be the best fit for your business. 

Unsure if Grimes may be the right fit? Learn Why West Texas Contractors Trust Grimes with their business insurance needs. Even if you don’t work with our team, we want your business to be well equipped and covered.

The Best Car Insurance Options for Teen Drivers in West Texas

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Quick Answer:

For most families with a teen driver, the best insurance setup includes higher-than-minimum liability limits, collision, comprehensive, and uninsured motorist coverage. Adding your teen to your existing policy, choosing an appropriate vehicle, and taking advantage of available discounts can help manage the higher premium without creating coverage gaps.

Adding a teen driver to your car insurance can be one of the biggest premium increases your family faces. It tends to be a juggle between maintaining a manageable price and determining which coverage setup gives your family the protection you need.

A 16-year-old can double or triple your policy cost overnight, adding $3,211 a year on average. Most families respond by looking for ways to cut coverage and reduce the number of policies. However, that’s the wrong move. 

The families who end up with the best outcome are the ones who understand which coverage is non-negotiable, which options are genuinely flexible, and which discounts actually move the needle.

At Grimes Insurance Agency, we help West Texas families structure teen-driver coverage every week. We see the same mistakes repeatedly, and we see which setups protect families and which ones leave them exposed. We’ve been determined to help families get this right since 1948.

In this article, we’ll break down:

  • The best coverage setup for your teen driver
  • The best way to structure your policy
  • The best ways to lower the added

Why Does Teen Driver Insurance Cost So Much? 

You’re not the only one asking this question. It’s a common curiosity our clients have. 

The fact is this: teen drivers (between ages 16 and 19) are statistically involved in accidents nearly three times more than drivers over 20. Insurance carriers price that statistical risk into every policy the moment a teenager is added. The premium increase may not be negotiable, but the coverage decisions you make around it are. 

Let’s review what we consider some of the best options together.

What Makes a Teen Driver’s Insurance Coverage “Best”?

“Best” doesn’t necessarily mean the cheapest policy.

For this article, we consider the best teen-driver setup to be the one that provides strong protection against the financial risks a young driver is most likely to create while giving the family reasonable ways to manage the additional premium.

That means we’re looking at four things:

  1. Protection: Does the coverage adequately protect your household if there’s a serious accident?
  2. Vehicle exposure: Does the policy protect the vehicle your teen actually drives?
  3. Local risk: Does the coverage account for risks common to West Texas, such as severe weather?
  4. Cost management: Can you reduce the premium through discounts, vehicle selection, deductibles, or carrier comparisons without eliminating important protection?

We recently helped a household with three teenage drivers find their best coverage. In their case, removing rental reimbursement coverage made sense because they had additional vehicles at home. In those situations, Grimes Insurance Agency can help you find ways to reduce your premium while still keeping other important protections in place.

What is the Best Teen Car Insurance Option?

For most families, the best coverage setup combines four important types of protection: 

Graphic highlights the four best insurance options for teen drivers with corresponding icons. Text overlay reads: High liability coverage, collision coverage, comprehensive coverage, and uninsured motorist coverage"

It seems like a lot, but we’ll help you break it all down. Here’s why each one earns a place in our recommended setup.

What Liability Limits Should a Teen Driver Have?

In Texas, drivers are required to purchase minimum liability insurance, commonly expressed as 30/60/25. This includes at least:

  • $30,000 per person for bodily injury
  • $60,000 per accident for bodily injury
  • $25,000 for property damage

However, those minimums may not provide enough protection for a household with a teen driver. A serious accident can result in medical bills, property damage, or other losses that exceed minimum limits.

 

At Grimes Insurance, our liability standard for clients is 50/100/50.

That means $50,000 per person for bodily injury, $100,000 per accident for bodily injury, and $50,000 for property damage. 

Definitions of Texas Liability Limits and Grimes' Liability Limit Standards (50/100/50). Information is included in written section above.

The Insurance Information Institute (III) recommends an even higher minimum liability coverage of 100/30/100 when adding a teen driver.  

Why this is our best option: A teen driver’s increased accident risk makes adequate liability protection especially important. The goal isn’t to assume your teen will cause an accident; it’s to make sure your family is prepared if an unexpected accident happens.

Should a Teen Driver Have Collision Coverage?

Collision coverage involves vehicle damage caused by colliding with another object. This includes other vehicles, road signs, buildings, trees, and other types of property. 

Because teen drivers have less experience behind the wheel, we consider keeping collision coverage one of the strongest protection choices for a vehicle a teen regularly drives.

Dropping collision coverage may lower the premium, but it also means your family could be responsible for the vehicle’s repair or replacement costs after a covered accident.

Why this is our best option: The premium savings from dropping collision coverage may not justify the financial exposure if your family can’t comfortably replace or repair the vehicle.

Is Comprehensive Coverage Worth It for a Teen Driver?

Comprehensive coverage protects against damage that isn’t caused by a collision, including weather, theft, and other covered events. 

For West Texas families, hail and dust weather deserves special consideration. 

Comprehensive coverage isn’t legally mandatory simply because you live in West Texas, but our region’s hail exposure makes it an important coverage to think about.

In our experience, we’ve seen a single storm can cause $3,000 to $8,000 worth of damage. However, annual comprehensive premiums are typically cost-effective, running a little over $134 per year. 

Why this is our best option: If your teenager’s vehicle is exposed to frequent severe weather, saving money by dropping comprehensive insurance can create a much larger financial risk than the premium savings.

Does a Teen Driver Need Uninsured Motorist Coverage?

Uninsured motorist coverage is designed to help cover any injuries caused during an accident involving an uninsured driver, and many drivers are quick to remove it to save on their premium. 

However, one in eight Texas drivers carries no insurance (ouch). If one of them hits your teen, uninsured motorist coverage pays for the damage and injuries that would otherwise come out of your pocket.

Why this is our best option: Your teen’s insurance protection shouldn’t depend entirely on the other driver having adequate coverage.

Interested in adding uninsured coverage to your auto policy? Watch this video to first understand your rights in an uninsured driver accident before discussing with your agent:

The Best Options for Structuring Teen Driver Coverage

Should You Add Your Teen to Your Existing Car Insurance Policy?

For most families, the best starting point is adding their teen to the existing family auto policy. Your current multi-car, bundling, and other applicable discounts may help offset part of the teen-driver surcharge.

Why this is our best option: Keeping the teen on the family policy is often the simplest way to maintain the household’s existing coverage structure while taking advantage of discounts already available to you. 

That doesn’t mean your insurance company will always offer the lowest price. Teen-driver pricing can vary significantly between insurance carriers, so it’s helpful to research before settling with your current policy. 

If you’re interested in comparing cost options, Grimes Insurance Agency can help you shop across carriers. We’d love to help you review your coverage and find your best option.

Should Your Teen Drive an Older Vehicle?

If your family has multiple vehicles, consider which one your teen will regularly drive.

Assigning your teen to an older, lower-value vehicle can reduce the collision and comprehensive premium compared with assigning them a newer or more expensive vehicle. 

Now, this doesn’t mean the oldest vehicle in the driveway is automatically the best choice. Safety features, reliability, condition and whether the vehicle is appropriate for a new driver should all be considered. 

Why this is our best option: It can reduce the cost of insuring a teen without eliminating important coverage.

What if Your Teen Owns Their Own Vehicle?

If the vehicle ownership belongs to your teenager, it changes the dynamic. Most insurance companies require teenagers who own their vehicle to purchase a separate policy, apart from their parents. However, the process of doing so is often expensive and requires a co-sign from a parent. 

Graphic includes icons to depict the three best options for structuring teen coverage, as listed in the above section. The overlay text reads: add to a current policy, drive an older vehicle, and own a personal vehicle"

What are the Best Ways to Lower Teen Driver Insurance Costs

Once you’ve established the coverage your family needs, look for discounts and policy changes that lower the premium without sacrificing important protection. Some of the top savings strategies we recommend include:

1. Ask About a Good Student Discount 

Most carriers offer this for teens who maintain a B average or higher. We consider this one of the simplest discounts for eligible teen drivers to look into. 

Requirements vary by carrier, so confirm what documentation and grade requirements apply to your policy. 

2. Ask About Driver Education Discounts

Completing an approved driver education course also qualifies for premium credits with most Texas carriers. 

Before paying for a course specifically to receive an insurance discount, confirm with your agent that the course qualifies with your carrier. 

Some courses that may be worth looking into include:

The Texas Department of Licensing and Regulation (TDLR) maintains information about approved driver education providers.

3. Consider a Telematics Program 

Usage-based programs (also known as telematics) monitor driving behavior and may reward qualifying drivers with discounts over time. 

This can be one of the better options for families whose teen consistently demonstrates safe driving and who are comfortable with the program’s monitoring.

Before enrolling, understand what the program tracks and how the carrier uses that information:

4. Consider a Higher Deductible 

Raising the collision deductible on an older assigned vehicle can reduce the premium without removing the coverage. 

This option is best for families that could comfortably pay the higher deductible if an accident occurred. 

A lower premium isn’t worth much if your household can’t afford the out-of-pocket expense after a claim. 

Finding the Best Teen Car Insurance With Grimes

Adding a teen driver can create a significant increase in your insurance premium, but the lowest premium isn’t necessarily the best outcome.

The best setup balances strong protection with practical ways to manage the added cost.

For most West Texas families, that means full coverage with higher liability limits, uninsured motorist coverage, adding the teen to the existing policy when it makes sense, and assigning the teen to an appropriate vehicle. 

If you’re trying to figure out what works right for you, give us a quick call. We can provide some free advice on which direction to lean. And even if you don’t work with us, we want you to feel equipped to find and get the best insurance possible.

If you’re still unsure and want to learn more about managing coverage costs, read 7 Ways to Lower Your Car Insurance to understand which changes can reduce your premium without creating new coverage gaps.

Grimes Insurance Agency has been helping West Texas families structure teen driver coverage since 1948. If you want help comparing coverage, deductibles, and carrier pricing for your household, our team can help you review your options.

Frequently Asked Questions

How much does adding a teen driver to your car insurance policy increase your premiums? 

Adding a teen typically increases a family’s premium by 50 to 100 percent or more, depending on the carrier, the teen’s age, and the vehicle they drive.

Should a teen driver have their own policy or be added to the family policy? 

For most families, adding the teen to the existing policy costs less. A separate policy makes more sense when the teen owns their own vehicle. 

What is the best car insurance coverage for a teen driver? 

Full coverage, which is liability at higher-than-minimum limits, collision, comprehensive, and uninsured motorist, is the best setup for most teen drivers. The goal is not the lowest premium but the coverage that performs when a teen’s higher accident risk results in a claim.

Disclaimer: The information provided in this article is for general informational purposes only and does not constitute legal, financial, or insurance advice. Coverage options, terms, and availability may vary. Please consult with a licensed professional for advice specific to your situation.

Comparing Car Insurance Quotes: What Actually Matters

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Have you ever compared car insurance quotes and walked away more confused than when you started?

Is the cheapest quote you received your best option, or even a viable option? 

Most drivers compare quotes by looking at one number: the monthly premium. But two quotes at different prices can offer identical protection, and two quotes at the same price can offer dramatically different coverage. 

The difference only becomes visible when a claim is denied, or a settlement falls short.

At Grimes Insurance Agency, we compare quotes across multiple carriers for West Texas drivers every day. We see how much pricing varies for identical coverage and how often the lowest quote comes with exclusions or deductible structures that create real exposure. We have been helping drivers cut through that confusion since 1948.

By the end of this article, you will learn:

  • Which coverages to compare
  • Which comparison mistakes to avoid
  • How to determine if your auto quote is the right fit

How to Compare Car Insurance Quotes Fairly

Before you can compare prices, it’s important to be sure you’re comparing the same coverage. It’s no surprise that insurance terminology gets confusing, and coverage details and definitions tend to blur together.

When requesting multiple quotes, give each insurance carrier the same information and ask for the same coverage specifications, including: 

A quote comparison is only meaningful when you’re comparing equivalent coverage from one carrier to another. 

For example, imagine you receive these two quotes:

Quote A Quote B
Monthly Premium $150 $175
Liability Limits 100/300/100 100/300/100
Comprehensive Deductibles $1,500 $500
Collision Deductibles $1,500 $500
Uninsured/Underinsured Motorist $50,000/$100,000 $100,000/$300,000
Rental Reimbursement Not included Included

At first glance, Quote A looks better because it saves you $25 per month. 

However, if you have a covered accident, you could pay an additional $1,000 toward your deductible compared with Quote B. Quote B also provides higher rental reimbursement and additional coverage. 

That doesn’t automatically make either the perfect choice, but it demonstrates why comparing premiums alone can be misleading.

Before comparing quotes, it’s helpful to understand what the coverage actually means. Read Liability vs. Full Coverage Car Insurance Explained to ensure you know what you’re evaluating.

What Should I Look for in a Car Insurance Quote Beyond Price? 

Are the liability limits high enough?

In Texas, minimum liability limits of $30,000 per person, $60,000 per accident, and $25,000 for property damage are a legal floor. Those are the legal limits, but not necessarily the amount of coverage that makes sense for every driver.

A serious accident can result in medical bills, vehicle damage, and other costs that exceed minimum limits. If your policy limit isn’t enough to cover the damages you’re legally responsible for, you could be responsible for the difference.

For this very reason, Grimes Insurance’s recommended liability standard for clients is 50/100/50. That means $50,000 per person for bodily injury, $100,000 per accident for bodily injury, and $50,000 for property damage. 

Definitions of Texas Liability Limits and Grimes' Liability Limit Standards (50/100/50). Information is included in written section above.

 

In our experience, higher liability limits leave less room for coverage gaps. We find it’s better to be safe than sorry when purchasing liability coverage. 

Remember, don’t compare premiums without first comparing the liability limits behind those premiums.  

Can I afford the deductibles?

A deductible is the amount you pay out of pocket before your insurance pays for a covered loss. 

For example, choosing a $2,000 comprehensive deductible may lower your premium compared to a $500 deductible. But if your vehicle suffers covered hail damage (a common phenomenon in West Texas), you’ll need to be prepared to pay that $2,000 before the policy pays the remaining covered amount. 

Graphic depicting an example formula of how deductibles work: Repair Costs ($7,000) minus Your Deductible (What You Pay, $2,000) equals the insurance payout(What Insurance Pays, $5,000).

The lowest premium isn’t necessarily the best value if the deductible would be difficult for you to afford after a loss.

What does the car insurance policy exclude?

Exclusions are the specific situations or types of losses your policy does not cover. 

For example, if a policy excludes certain business use of a vehicle, that exclusion could become important if you’re using the vehicle for work when an accident occurs.

Ask what your policy excludes before you compare premiums.

A lower price doesn’t help if the policy doesn’t cover the situation you’re trying to protect yourself against.

How should I evaluate my insurance carrier?

If you could take only one thing away from this article, it should be this: price isn’t the only factor to consider when choosing an insurance carrier!

You can review financial-strength information from AM Best and complaint information from the Texas Department of Insurance as part of your research. It’s also worth asking questions about how claims are handled and what you can expect if you need to use your coverage. Grimes Insurance Agency can help you with this process. Call our office to connect and review your coverage options with an agent. 

The company behind the policy matters because the value of insurance becomes most apparent when you need to file a claim

What Are the Most Common Mistakes Drivers Make When Comparing Quotes?

Comparing only the price

A lower quote may have higher deductibles, lower liability limits, or fewer optional coverages.

Assuming every carrier applies discounts the same way

Carriers can offer different discounts and may apply eligibility requirements differently. Ask each carrier which discounts are included and which ones you may qualify for. 

Looking at a bundle without comparing the total cost

Bundling auto and home insurance can be one of the most helpful discounts. However, you should still compare the total cost and coverage for both policies. 

Remember, a discount doesn’t automatically make a bundle the best overall option. 

Ignoring coverage details that matter in your area

Living in West Texas comes with different risks than living in Dallas. Insurance carriers in this region sometimes impose restrictions on vehicle hail-damage claims, such as higher deductibles, actual cash value settlements for older vehicles, or limits on claim frequency. 

Rather than assuming every carrier handles these situations the same way, ask the agent to explain the specific terms of the policy you’re considering. 

What to Do Before You Choose a Car Insurance Policy 

Before you choose a policy, take a few minutes to compare more than the dollar sign you see. 

Check your current liability limits, collision and comprehensive deductibles, optional coverages, and any exclusions that apply to your vehicle. 

Then discuss with your agent:

  • Are the coverage limits the same between quotes?
  • Are the deductibles and optional coverages the same?
  • Are there exclusions or restrictions I need to understand?
  • Have I considered the carrier’s financial strength and complaint history?

The best car insurance quote isn’t necessarily the cheapest. It’s the one that gives you the protection you need at a price that makes sense for your situation.

Now that you know what to look for, your next step is understanding what the quote process actually looks like. Read The Insurance Quote Process at Grimes Insurance Agency so you know what to expect before you request your next quote.

At Grimes Insurance Agency, we help West Texas drivers compare coverage and pricing across multiple insurance carriers so they can make a more informed decision.

Frequently Asked Questions

What is the most important thing to compare in car insurance quotes? 

Coverage limits, deductibles, and policy exclusions matter more than the premium alone. Two quotes at the same price can offer different protection.

How do I make sure I am comparing quotes fairly? 

Request quotes with identical coverage specifications from every carrier: same liability limits, same deductibles, and the same additional coverages.

Does the cheapest car insurance quote mean the least coverage? 

Not always, but often. Lower premiums can reflect lower limits, higher deductibles, or missing coverages. Always verify what is behind the number.

How often should I compare car insurance quotes?

At every renewal. Carrier pricing shifts regularly, and the market changes. A policy that was competitive last year may no longer be so today.

Should you use an independent insurance agent to compare quotes? 

It can depend. Independent insurance agents have access to multiple carriers, allowing you to compare multiple options at once. However, buying directly from a carrier (or a captive agent who works for your carrier) can also make sense for someone who prefers to handle the comparison and policy process independently. 

Does an independent agent cost more than buying directly from a carrier? 

No. The agent’s commission is built into the premium regardless of how you buy. In many cases, an independent agent finds a lower total premium by comparing multiple carriers simultaneously.

 

Disclaimer: The information provided in this article is for general informational purposes only and does not constitute legal, financial, or insurance advice. Coverage options, terms, and availability may vary. Please consult with a licensed professional for advice specific to your situation.

7 Ways to Lower Your Car Insurance Payment (Without Losing Coverage)

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Are you paying more for car insurance than you should, but afraid that cutting costs means cutting protection?

And do you know which changes actually lower your premium versus which ones quietly leave you exposed?

Most drivers assume the only way to lower their car insurance is to drop coverage. However, that assumption can be costly, resulting in having to pay more for uncovered claims. The right approach lowers your cost without removing the protection you actually need.

At Grimes Insurance Agency, we have spent over 78 years reviewing auto policies for West Texas drivers. As an independent agency, we compare pricing across multiple top-rated carriers every day to find the one that delivers the most protection for what you actually pay. We see the same overpayment patterns repeatedly, which means we know exactly where the savings are and where the traps are. 

In this article, you will learn seven proven ways to lower your car insurance premium without reducing your protection, and what separates a smart cost reduction from one that creates a gap you will not discover until it is too late. 

Why is My Car Insurance So Expensive?

Most drivers overpay because they made a good decision years ago and never revisited it. 

Your vehicle ages. Your loan gets paid off. Your credit score improves.

Each of those changes affects what your policy should cost, but most carriers do not adjust your rate automatically when your situation improves.

In our experience, we’ve seen that drivers who pay the least for the most coverage treat their policy as a decision worth revisiting.

How Can I Lower My Car Insurance Costs?

It’s a valid question. And we’re so glad you asked! Let’s look at seven of the best ways to lower your costs (without losing adequate coverage):

1. Shop Across Multiple Carriers at Renewal

Premiums for identical coverage can differ by 30 to 40 percent depending on the carrier. A policy that was competitive two years ago may no longer be so today. 

The kind of insurance agent you work with is an important part of this shopping experience. A captive agent can only reprice you within one company, which can limit your shopping options. However, an independent agent (like Grimes) can help you compare your options across multiple carriers in one conversation. 

Deciding between a captive or independent agent is a personal choice, but really depends on where and how you want to shop. To learn more about the difference between captive and independent agents and how they are paid, read How Do Independent Insurance Agencies Work?

Shopping your policy at every renewal is the most practical way to ensure you are not paying a rate that no longer reflects your risk. Auto policy renewals are typically every 6 to 12 months, depending on your carrier. If you’re unsure of your policy’s renewal timeframe, we recommend contacting your insurance agent to clarify.

2. Raise Your Deductible Strategically

Pay a higher deductible to save money? Yep, you read that right! 

Increasing your collision or comprehensive deductible from $500 to $1,000 can reduce your annual premium by 10 to 20 percent. However, the keyword is that strategically raising your deductible only makes sense if you can actually cover the higher amount after a loss.

The right deductible is the one you could actually pay the day something goes wrong.

3. Bundle Home and Auto Policies

Carriers that write both home and auto typically offer multi-policy discounts. We’ve seen carriers provide 10-25% discounts on both policies when clients are bundled with the same company. 

However, before committing, compare the total bundled cost against separate quotes. Some carriers offer aggressive discounts on one line but charge more for the other. Our Grimes team can help you in this search. If you’re interested in reviewing potential bundling options, contact our office to compare with an agent. 

Bundling is worth pursuing in our book– but it’s important to verify the total cost rather than assuming the discount automatically makes it the best option.

4. Ask About Discounts You Have Not Been Told About

In addition to bundling, there are multiple discounts carriers offer to drivers. While they vary between providers, some common auto discounts include: 

  • Safe driver discounts
  • Low-mileage discounts
  • Vehicle safety feature credits
  • Paperless billing
  • Good student discounts 
  • Auto Applications/Plug-ins (also known as telematics)

A discount you don’t know about is a discount you’re not receiving. However, we like to consider ourselves discount detectives. Grimes Insurance Agency can help you review your coverage and look for potential discounts you might be missing out on.

5. Improve Your Credit Score

If you didn’t know, your credit score can make or break your insurance options. In Texas, carriers are permitted to use credit-based insurance scores as a rating factor. This means that depending on how high or low your score is, you’re being evaluated on how much of a risk you may be to an insurance company. For instance, a strong credit profile can lower your risk, while a poor one can raise it. 

Graphic depicting image of "Insurance risk formula". Reads "Insurance risk = likelihood of claim x potential cost of claim"

Curious if your insurance risk is worth reviewing? Read How is Insurance Risk Calculated to learn how it’s affected and what you can do to improve it. 

Improving your credit score is one of the most effective long-term ways to reduce your premium. When your score improves meaningfully, we recommend you notify your agent and request a requote. 

6. Remove Coverage You No Longer Need

As your vehicle ages and its value decreases, the financial case for carrying additional protections weakens. 

Some drivers may also choose to remove optional coverages they rarely use because of the age of their vehicle, like comprehensive and collision coverage. 

A general recommendation we give our clients is the 10 percent rule: if your annual collision and comprehensive premiums equal or exceed 10 percent of your vehicle’s current value, consider dropping those coverages.

Graphic depicting the 10 percent rule. Overlay text reads: Consider dropping comprehensive/collision coverage when... Annual premiums equal or exceed 10% of the vehicle’s book value and/or the vehicle is greater than 10 years old.

However, others may decide that their household, driving habits, or financial situation is worth keeping higher limits or additional protections. It all boils down to your specific needs.

For instance, we recently helped a family with multiple teenage drivers lower their monthly auto costs. In their case, removing rental reimbursement coverage made sense because they have extra cars at home. In those situations, Grimes Insurance Agency can help you find ways to reduce your premium while still keeping other important protections (like higher liability coverage) in place.

7. Maintain a Clean Driving Record

Sounds easy enough… right? 

Unfortunately, a single at-fault accident can raise your premium by 30 to 40 percent and follow you for three to five years. The quickest way our clients have lowered their car insurance is by giving their carrier no reason to raise it.

If you’re worried about an accident staying on your record, watch this video to learn more about your options: 

The most cost-effective long-term action requires no payment at all: driving clean and keeping your record clear.

How Grimes Can Help You Lower Your Car Insurance the Right Way

You now know seven ways to lower your car insurance without removing the protection you need. The drivers who overpay are just working off a decision made years ago that nobody told them to revisit.

The real cost of overpaying is the coverage gap that forms when drivers try to fix the problem on their own by dropping the wrong protections. Understanding which levers to pull and which ones to leave alone is the difference between a lower bill and a coverage failure. 

Before your next renewal, ask whether your carrier is still the most competitive option, whether your deductible still makes sense for your vehicle’s current value, and whether every available discount has been applied. Those three questions alone can change what you pay.

Grimes Insurance Agency has been helping West Texas drivers find the right auto coverage at the right price since 1948. We are locally owned, represent multiple top-rated carriers, and will compare real pricing differences for your specific situation.

Before you request a quote, review the process. Read about the Insurance Quote Process at Grimes Insurance Agency to know exactly what to expect and which information will get you the most accurate rate.

Frequently Asked Questions

Will lowering my deductible save me money? 

Raising your deductible, not lowering it, reduces your premium. Lowering it increases your premium because the carrier takes on more financial risk.

Does removing collision or comprehensive leave me unprotected? 

It removes protection for damage to your own vehicle. Liability remains in place. Removing collision and comprehensive coverage on an older, low-value vehicle is a financial decision. 

How often should I shop for my car insurance? 

At every renewal. Carriers reprice regularly, and the market shifts. An independent agent can compare options across multiple carriers without requiring multiple calls.

Can I lower my rate without changing my coverage? 

Yes. Shopping carriers, improving your credit, applying available discounts, and bundling can all reduce your premium without changing your coverage levels.

Does a defensive driving course lower my car insurance in Texas? 

Some carriers offer discounts for completing an approved course. Ask your agent whether your carrier offers this credit and which courses qualify.

Disclaimer: The information provided in this article is for general informational purposes only and does not constitute legal, financial, or insurance advice. Coverage options, terms, and availability may vary. Please consult with a licensed professional for advice specific to your situation.

Best Home Insurance for Old Houses: What to Look For

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Quick Answer:

Older houses often require more specialized homeowners insurance than newer homes. While every policy covers the basics, we recommend looking for four key features when comparing coverage: hidden water damage protection, strong roof coverage, matching of undamaged property, and understandable carrier guidelines. These coverages, as well as an understanding of your home’s maintenance and claims history, can help you avoid costly coverage gaps later. 

A note about our recommendations: Grimes Insurance is an independent insurance agency that works with a network of insurance carriers, including some mentioned in this article. The recommendations below are based on our experience helping West Texas homeowners insure older homes and the coverage considerations we believe are most important. The best carrier for your home will depend on your specific situation, eligibility, and available coverage.

If your home was built decades ago, have you wondered whether your current homeowners insurance would actually cover the repairs it needs after a major loss? If you own, or are looking to buy, an older house, you’ve probably realized that getting homeowners insurance isn’t as straightforward as insuring a new construction. One insurance company may ask about your roof, another may want to know when the plumbing was updated, and another might require an inspection before they’ll even consider coverage. It feels like a headache at every turn. 

That’s because older homes often present different risks than newer ones. Aging building materials, outdated systems, and previous claims can all influence your premium. Comparing policies can quickly become overwhelming, especially if you’re not sure which coverage differences actually matter. However, you’re not alone in figuring it out.

At Grimes Insurance, we’ve helped West Texas homeowners insure older homes since 1948. One of the biggest mistakes we’ve seen homeowners make is comparing policies only on price without understanding the coverage differences that matter most. 

By the end of this article, you’ll learn the four most important things to look for when comparing homeowners insurance for an older home, along with which carriers Grimes Insurance has found to be a strong fit based on our experience.

1. Does Your Policy Cover Hidden Water Damage?

Most homeowners insurance policies include coverage for sudden and accidental water damage. This could look like the washing machine hose bursting or a water heater cracking and flooding your home. This coverage typically comes with its own sub-limit, often $5,000, $10,000, $15,000, or $25,000, up to your full dwelling amount, so it’s worth confirming what that limit actually is on your policy.

Older homes often face a different problem: slow plumbing leaks hidden behind walls or under floors. This kind of damage is sometimes called a “sneaky leak,” because it can go unnoticed for weeks or months before anyone discovers it. Even though the damage may look sudden once you find it, the actual cause was gradual — and that distinction matters.

That’s where a separate coverage, commonly called Hidden Water Seepage and Leakage, comes in (naming varies by carrier). Unlike standard sudden and accidental coverage, only a handful of carriers offer this endorsement at all, so it’s not something to assume is available. For older homes, it’s one of the most valuable coverages to ask about specifically.

Without this endorsement, a slow leak may be excluded, even if the damage appears sudden by the time you discover it.

When comparing insurance policies and options, ask your agent:

  • Is hidden water coverage included automatically?
  • Does it require an endorsement?
  • Are there any limits or exclusions?

2. How Does Your Home Insurance Policy Cover an Older Roof?

Roofs are one of the biggest factors insurance companies consider when underwriting a home. More importantly, not every policy covers an older roof the same way.

Most carriers now apply a 2% wind and hail deductible as a standard part of the policy. This has become the norm across the industry, not the exception. But age can change more than your deductible. 

Even when the rest of your home stays insured at full replacement cost, many carriers treat the roof differently. Some begin factoring in a roof schedule, where the amount they’ll pay out on a roof claim decreases as the roof gets older, on top of the 2% deductible.

Let’s consider a roof that’s significantly aged. For instance, a 20+ year old composition shingle roof most likely won’t be denied because of wind and hail coverage. Instead, the insurance carrier may settle roof claims at actual cash value instead of replacement cost, or decline to write the home altogether.

Each carrier sets its own underwriting guidelines, so how your roof is treated can vary significantly from one company to the next.

When comparing insurance policies and options, ask your agent:

  • What wind and hail deductible would apply to my roof?
  • Would my roof be covered at replacement cost or actual cash value?
  • Does this policy use a roof payment schedule based on the roof’s age?
  • Does the carrier require an inspection before insuring my home?

Whenever possible, we recommend understanding exactly how your roof will be settled before choosing a policy– not after you have a claim. 

3. Does Your Home Insurance Policy Replace Undamaged Materials?

Unfortunately, this is not a challenge only older homes face. In some states, like Texas, a matching statute isn’t required. If it’s not, this means that insurance companies in your state aren’t obligated to make repairs to your home look uniform. Surprisingly, only 16 out of 50 U.S. states have a matching statute! 

Another challenge, specifically with older homes, is that your home’s building materials may no longer be manufactured. With all of this in mind…if a storm damages one side of your home, standard homeowners insurance may only pay to replace the damaged portion.

That could leave you with:

  • Mismatched siding
  • Different shingles
  • Patched hardwood flooring
  • Brick that doesn’t match the rest of the home
Graphic includes four images of mismatched home damage repairs. 1) Mismatched siding, 2) Different shingles, 3) Patched hardwood flooring, 4) Mismatched brick

Examples of Mismatched Home Damage Material Repairs

So, if your standard homeowners policy (or state) won’t cover this… what will? Your answer is an endorsement commonly called Matching of Undamaged Property. This endorsement helps pay to replace undamaged materials so repairs maintain a consistent appearance throughout your home. 

If preserving your home’s original character matters to you, whether old or new, this is a home coverage worth discussing with your insurance agent. 

When comparing insurance policies and options, ask your agent:

  • Does this policy include matching coverage for undamaged materials?
  • If only part of my siding, roofing, flooring, or brick is damaged, what will the policy pay to replace?
  • Are there any limits or exclusions on matching coverage?
  • Does my state require the insurer to match undamaged materials?

4. How Does Your Insurer’s Underwriting Guidelines Handle Older Homes?

Sometimes the biggest difference between insurance companies isn’t the policy, but their underwriting guidelines. We like to explain underwriting to our clients as their insurance company’s “appetite”. (Now, stay with us.)

Underwriting guidelines are often built around the company’s comfortable risk level. In other words, they each have their own “appetite” for risk, making each company’s underwriting conclusion unique. This means that some insurers may be more comfortable with insuring older homes than others. That’s why one insurance company may decline an older house while another is perfectly willing to insure it.  

Depending on the carrier you work with, they will more than likely ask about:

  • Your roof’s age
  • Your home’s electrical panels
  • Your home’s plumbing update history
  • Your home’s foundation and possible issues

Graphic listing information carriers often ask when insuring older homes. Includes information from bullets listed above.

Rather than assuming every insurance company evaluates older homes the same way, ask how your insurance carrier approaches homes with aging systems before you commit to a policy.

When comparing insurance policies and options, ask your agent:

  • How does this carrier evaluate older homes during underwriting?
  • Does the age of my roof, plumbing, electrical system, or foundation affect my eligibility?
  • Will the carrier require an inspection before insuring my home?
  • Are there specific updates or repairs I need to make to qualify for coverage?

What information do you need to get home insurance for an older house?

Before shopping for insurance, gather as much information about the home’s major systems as possible. 

That includes documentation showing:

It seems like a lot of information; we know. However, in addition to risk, there’s another reason all of this matters: your insurance claims history.

How does my claims history affect home insurance for older houses?

Your insurance claims history is one of the biggest factors in determining your premiums and risk level. Personally, a frequent or recent number of claims can affect your rates or eligibility for coverage. However, when you shop for home insurance, your claims history isn’t the only one insurers look at. They also consider your home’s claim history. 

Yep. You read that right. Your home has one, too! Insurance claims history follows the property, not just the homeowner. Claims filed by a previous owner can affect your premium even if you purchased the home after the losses occurred. This information is gathered using a CLUE (Comprehensive Loss Underwriting Exchange) report, which tracks property insurance claims for up to seven years.  

Graphic depicting information CLUE reports include: Claims filed in the last 5-7 years, claims filed on your property (even by previous owners), and date/type of loss/amount paid details.

We’ve worked with buyers who were surprised to learn a previous owner’s water claim still appeared during underwriting and affected their insurance options. 

Running a claims history report and collecting maintenance records is already a smart move when you’re shopping for home insurance. It can make an even greater difference when insuring an older home. 

To review your home’s claim history, you can request and dispute your CLUE report once a year through the LexisNexis Consumer Portal. If your report seems concerning, we recommend walking through your information with an insurance agent. Doing so can help you prevent surprises and make it easier to compare insurance quotes more accurately.

Have more questions about insurance risk? Read How Insurance Risk is Calculated to learn more about what you can do to keep your risk profile in check.

How do you compare home insurance quotes for an older home?

It’s easy to only look at the price when comparing your insurance options. However, we urge our clients to remember that while cost is important, it shouldn’t be the only factor you compare.

As you’re reviewing policy quotes, ask yourself:

Question Why it Matters
Does this include hidden water coverage? Older plumbing is more susceptible to slow leaks.
How is the roof covered? Replacement cost and actual cash value can lead to very different claim payouts.
Is matching coverage available? Helps preserve your home’s appearance after a partial loss.
What are the wind and hail deductibles? Your out-of-pocket costs could vary significantly.
Is the carrier comfortable insuring older homes? Underwriting guidelines differ from company to company.

When insuring an older home (or any home for that matter), looking beyond the premium helps you choose a policy that’s a better fit and avoid unexpected coverage gaps later. 

Once you know what to look for in a policy, the next step is identifying insurance companies that commonly offer these protections. While every situation is different, there are a few carriers we’ve consistently found to be good options for older houses.

Which carriers does Grimes Insurance recommend for older homes?

If it’s not clear by now, not all carriers treat older homes the same way. Based on our experience insuring older homes, we’ve found that some carriers can be a better fit depending on the home’s age, roof, systems, claims history, and the coverage available.

The carriers below are recommendations based on Grimes Insurance’s experience and the policy features we believe are particularly important for older homes. Remember, they are not necessarily the best choice for every homeowner, and coverage, eligibility, endorsements, and underwriting guidelines can vary by home and location.

Carrier Why it May be a Good Fit Coverage to Verify
Liberty Mutual Strong option for older homes based on Grimes’ experience (forgiving endorsements, timelines, etc.) Hidden water coverage
Nationwide More forgiving roof depreciation timeline Roof settlement terms
Travelers Can work well depending on endorsements Hidden water endorsement availability

Before choosing any carrier, here are the coverage features we recommend comparing.

In our experience, Liberty Mutual and Nationwide are generally strong picks. Both are more likely to include the hidden water seepage and leakage coverage older homes need. Additionally, Nationwide typically doesn’t begin depreciating your roof’s value until it’s around 11 years old, which is more forgiving than other competitors. 

We’ve seen that Travelers can also be a solid option for older homes; however, the hidden water endorsement usually has to be added to your policy, rather than being standard. Wherever you’re at in the comparison, it’s always worth confirming what’s included in your policy before you buy. 

Based on our experience working with older houses, these carriers often offer policy features that make them a strong fit. However, eligibility, endorsements, and coverage options vary across homes, locations, and underwriting guidelines. In a nutshell, the best choice depends on your specific situation. 

Also keep in mind that coverage names and availability can change over time. At renewal, it’s worth double-checking with your agent that your policy still includes the protections you need and that the carrier’s terms haven’t changed. 

If you’re considering working with an independent insurance agency, read How Independent Insurance Agencies Work to understand how independent and captive agents differ and which approach may be the better fit for you.

What should you do next to protect your older home?

Older houses aren’t necessarily harder to insure, but they do require a policy that’s built around their unique risks. By understanding how a policy handles details like hidden water damage, roof claims, and how insurers evaluate older homes, you’ll be better prepared to choose coverage that protects both your home and your finances.

Your next step is understanding what happens after you file a claim. Even the best homeowners insurance policy is only as valuable as your ability to use it when something goes wrong. Read How Does Grimes Insurance Agency Handle Claims to learn what to expect, how we’ll help you at each step, and what you can do to tackle the claims process confidently. 

If you’re unsure whether your current policy includes the coverages discussed in this article, Grimes Insurance has been helping West Texas homeowners protect their homes since 1948. We’re happy to review your current policy and consider your coverage together.

What Causes Home Insurance Rates to Increase?

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Quick Answer:

Home insurance rates can increase because of your home’s claims history, your own claims, roof age and condition, property inspections, location, and other risk factors. Rates can also increase because of losses across the broader insurance market, including the cost of widespread hail and wind damage in West Texas. While you can’t control every factor affecting your premium, understanding what’s driving your increase can help you decide what to do about it. 

You opened your homeowners insurance renewal expecting a similar rate to last year, but instead… you’re met with a bill increase. Confusion and questions flood your mind:

Why did my rates increase? What can I do about this? And WHY is this so frustrating?!

They’re questions we hear all of the time. The answer is that insurance premiums are affected by many different factors. Some are connected to the choices you make, and others are simply outside of your control.

For over 78 years, Grimes Insurance Agency has helped West Texas homeowners understand their insurance coverage. While every client’s situation is different, we regularly help homeowners identify why their premiums changed and what options they have moving forward.

By the end of this article, you’ll understand:

  1. What causes home insurance rates to increase
  2. What factors you can control
  3. What steps you can take to ensure your coverage still fits your needs

Why Did My Home Insurance Rates Increase?

There are two broad reasons your home insurance premium can increase:

  • Factors specific to your home
  • Factors affecting the surrounding insurance market

Let’s break them both down together.

What Personal Factors Increase My Home Insurance Rates?

Contrary to what many policyholders believe, insurance is hardly a “set it and forget it” type of purchase. It’s an item that’s meant to grow with you as you and your assets change– in both protection and (sometimes) price. This means that some rate increases are connected directly to your home or insurance history. 

What Home Changes Can Increase Insurance Rates

Has your home changed in the last year? Have you made any home improvements or additions? Has your home’s condition aged significantly?

If yes, it’s a likely reason for a premium increase. As your home changes and ages, your coverage and pricing may too. Rates can be affected by property factors such as:

  • Adding features (pools, trampolines, etc.)
  • Making high-value home upgrades
  • Roof age and condition

For many of our clients, an aging roof has been one of the biggest premium increase surprises.

We recently worked with a homeowner whose roof was nearing ten years old. He hadn’t filed any claims and assumed his rate would remain steady. However, once his roof crossed that age threshold, his carrier began applying a depreciation schedule to any future roof claim. That meant less payout (and more out of his pocket) if hail or wind damage hit. It wasn’t something he’d thought about until his premium jumped at renewal.

How does my roof’s age and condition affect my insurance rate?

Let’s break down why roof age even matters in the first place.

Your roof is one of the most important parts of your home, but easily forgotten about. As your roof ages, your insurance risk increases as well. Insurance risk is the probability of a loss happening and how much it would potentially cost. 

Older roofs typically have a greater number of insurance claims than newer roofs. While the range varies between carriers (and what your roof is made of), insurers begin to raise home insurance rates once your roof reaches 15-20 years old.

Graphic of roof material lifespans. Text reads: "asphalt 15-20 years, wood 30-40 years, metal 40-70 years, clay 50-100 years, slate 75

Various Roof Material Lifespans

Keeping your roof (and home’s) information in mind can help prepare you for premium surprises. We recommend recording details about your roof’s age, condition, and repairs as helpful documentation for such scenarios, and to discuss them with your insurance agent. 

Interested in learning more about the role insurance risk plays in coverage? Read about how insurance risk is calculated.

Can Filing an Insurance Claim Increase My Home Insurance Rates?

How come something that’s meant to protect you costs more when you use it? It sounds backwards; we know. However, it’s simply the way insurance works. 

Your premiums can be directly affected by your insurance claims, even small ones. Insurers rely on your claims history to determine (you guessed it!) your risk profile. 

It can be tempting to file a claim whenever your damage exceeds your deductible. But the cost of a claim isn’t necessarily limited to the difference between the two. 

Consider this example: your deductible is $500, and you have $600 in covered home damage. Filing a claim may seem like an obvious decision because you’re only $100 above your deductible. 

However, a claim can become part of your insurance history and may affect how an insurer evaluates your risk in the future, and a heavy claims history can increase your rates. That’s why it’s worth looking beyond the immediate payout. 

Before filing a small claim, ask your agent to help you understand the potential long-term impact– not only what you’ll receive after your deductible. The right decision can depend on the circumstances, your policy, the size of the loss, and how your insurer evaluates claims history. 

What is a claims history?

A surprise for homeowners is that, like people, properties also have a claims history. A property’s previous claims history can affect how insurers view the home, even if you weren’t the homeowner who filed the claim.

For example, let’s say the homeowner you recently purchased your home from experienced a burst pipe in the kitchen. After the incident, they filed a water damage claim. Despite you not living there when it occurred, that history is still associated with the property and could affect how an insurer evaluates the risk. 

How do I learn about my home’s claim history?

If you’re buying a home, ask about the property’s insurance history before you close so you can understand what claims history may follow the address. This information is filed in a document called a CLUE (Comprehensive Loss Underwriting Exchange) report. Insurers use your CLUE report to price your home insurance policy and evaluate your insurance risk. 

To review your home’s claim history, you can request and dispute your CLUE report once a year through the Lexis Nexis Consumer Portal. If your report seems concerning, we recommend walking through your information with an insurance agent. Doing so can help you prevent surprises and make it easier to understand your options more accurately.

What External Factors Affect My Home Insurance Rates?

Not every rate increase has to do with your home specifically. A lot of it comes down to what’s happening across the insurance market as a whole. 

Can Home Insurance Rates Increase Even if I’ve Never Filed a Claim?

Unfortunately, yes. Insurance works by pooling risk, which means everyone’s premiums go into a shared pool that covers the claims paid out across all policyholders, not just yours. 

When claims and losses go up in your area, or across an insurance carrier’s book of business, rates tend to rise for everyone in that pool– even for homeowners who’ve never filed a claim. 

Graphic depicting images of additional factors that can increase home insurance, listed below

Additional external factors that can increase your home insurance rates include:

  • Frequent severe weather (aka, West Texas hail, dust, and ice storms)
  • Inflation and rising rebuild costs (higher material and labor expenses = higher insurance rates)
  • Higher reinsurance prices 
  • Increased natural disaster risk

If you’re worried about how external factors may affect you and your coverage, talk with a Grimes Insurance agent. We’re happy to help walk you through your coverage, answer your questions, and discuss how to be prepared for the unexpected.

What Can I Do When My Home Insurance Rates Increase?

You can’t control every factor affecting your premium. You can’t prevent every hailstorm or control the number of losses your insurance carrier experiences. 

But you can take steps to understand and potentially prevent some of the factors affecting your premium. 

Images depicting the four things to do when your home insurance increases, listed below (maintain property, reconsider claims, ask about deductibles, and review renewal)

1. Keep your roof and property in good condition

Maintain your roof, siding, fencing, trees, and other structures. Regularly document changes and repairs. 

2. Think carefully before filing a small claim

If the damage is only slightly above your deductible, talk to your agent before filing. Ask about the potential long-term impact, because paying out of pocket may save you more in the long run. 

3. Ask about your deductible options

A higher deductible can lower your premium, but it also means you’ll pay more out of pocket when you have a covered loss. 

Choosing a deductible is a trade-off between what you pay today and what you can comfortably afford after a claim. 

Talk with your agent about your options based on your financial situation and risk tolerance.

4. Have an agent review your renewal

When your renewal increases unexpectedly, don’t assume there’s nothing you can do. 

An agent who understands your policy can help identify what changes, explain coverage, and help determine whether there are adjustments (or discounts) worth considering. 

How Can Grimes Insurance Help Manage My Coverage?

Despite its confusing nature, a home insurance rate increase doesn’t always mean you did something wrong or that you need to immediately switch policies. Your premium can change based on factors related to your home, your claims history, or broader changes in the insurance market. 

If your renewal is higher than expected, start by finding out why your premium changed. Review your renewal, consider changes to your home or claims history, and talk with your agent about your coverage and available options. 

Understanding what’s driving the increase can help you make a more informed decision about your policy. At Grimes Insurance Agency, we are dedicated to helping West Texas homeowners understand their coverage and navigate changes to their policy. You’ll not only have help understanding your coverage, but also managing it throughout your policy. With the help of our retention team, you’ll always have someone in your corner to ensure your policy is protecting you where it matters most.

Wondering whether your new premium is reasonable? Learn more about Home Insurance Costs in Lubbock to understand what factors influence costs in the Lubbock area and what you may expect to pay.

What Makes a Home “High Risk” for Insurance?

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Quick Answer:

A home is considered high risk for insurance when insurers believe it’s more likely to generate expensive claims. Factors such as an older roof, prior claims, poor credit, outdated construction, location, and liability risks (like pools and trampolines) can all increase premiums. They can also reduce coverage options or even lead to policy non-renewal. Fortunately, some of these risk factors can be improved.

Have you ever opened your home insurance renewal notice and wondered why your premium went up? 

Maybe nothing changed about your home. You didn’t file a claim. You didn’t make any major changes. So why are you paying more? 

Many homeowners are surprised to learn that insurance companies look at more than just the age and value of their home. Factors like your roof, location, and even certain property features can affect how your home is evaluated. 

A high-risk classification may result in higher premiums, limited carrier options, coverage exclusions, or difficulty finding a policy with the protection you expect.

At Grimes Insurance Agency, we regularly review home insurance policies for West Texas homeowners and help identify the specific factors affecting coverage and pricing. Since 1948, our team has helped homeowners navigate challenges unique to this region, including severe hail storms, aging roofs, and changing insurance requirements. 

By the end of this article, you will learn:

  • What specific factors make a home high risk
  • How insurers evaluate property and personal risk
  • How being high-risk affects your coverage
  • What steps you can take to lower your insurance risk profile

What Does High-Risk Home Insurance Mean?

When an insurance company classifies a home as high risk, it means they believe the home may be more likely to have a claim or that future repairs could be expensive.

Insurance companies look at two main things:

  • How likely a claim is to happen
  • How much that claim could cost

For example, a home with an older roof in a hail-prone area like Lubbock may be considered higher risk. Unfortunately, a greater chance of roof damage means a greater chance of needing to make a claim.

Now keep in mind, a high-risk label does not always mean you cannot get insurance. Different insurance companies evaluate risk differently, which is why one company may decline a home while another may offer coverage.

What Home Features Increase Your Home Insurance Risk?

High risk is a combination of factors that carriers weigh differently. Let’s review them together:

Roof Age and Condition

In our experience reviewing homeowners policies across West Texas, roof age is by far the most common reason otherwise well-maintained homes receive higher premiums.

In areas where hail seasons are severe and frequent, a roof over 15 to 20 years old may result in coverage restrictions or an actual cash value settlement. Some carriers will not write a new policy on a home with a roof beyond a certain age. Others will write it, but exclude wind and hail, which are the exact coverage most Lubbock homeowners need.

Some carriers go a step further and reduce the insurance payout as your roof gets older, often starting around 11 years. So instead of paying to replace your roof at full cost, they’ll only cover part of it, based on how old the roof is at the time of the claim. That means two homeowners with the same-aged roof and the same damage could get very different amounts back, depending on which carrier they’re with.

Construction Type and Age

Wood frame construction carries a higher fire risk than brick or masonry. Older homes present additional concerns, including outdated electrical systems, galvanized plumbing, and aging structural components, all of which increase the likelihood of claims. 

One specific red flag we’ve seen many homeowners encounter is Federal Pacific Electric (FPE) panels. Many of these panels are found in older homes, and due to being outdated, some carriers won’t write a policy on a home with an FPE panel. Most carriers will require them to be replaced, and even updated panels can trigger additional underwriting review.

Two images of a Federal Pacific Electrical panel

Federal Pacific Electrical Panels

 

Location and Geographic Risk

Proximity to a fire station and flood zone designation affect your risk profile, as well as your geographic location. In West Texas, geographic risk is elevated by the region’s severe hail exposure. Lubbock and the Texas Panhandle rank among the most active hail markets in the country. 

Pool, Trampoline, and Dog Breed

Home insurance risk also involves what’s in and around your house. Pools and trampolines (also known as attractive nuisances) pose a greater chance for claims. 

The same can also be said about certain dog breeds (yes, even your dog!), due to the probability of dog bite claims or aggression. For example, some carriers might choose not to insure a home with specific dog breeds, like Pitbull Terriers or German Shepherds. 

Some carriers exclude these risks entirely or require additional endorsements. However, if you own one of these dog breeds, or recently installed a new pool and diving board, don’t assume the worst. Contact Grimes Insurance Agency to discuss your coverage options with an agent and get help managing your personal risk.

Graphics depicting some risk-associated factors. Factor images include a pool, trampoline, and a dog (to denote certain dog breeds)

Vacant Properties

A home that sits vacant, for example, one that’s listed for sale while the owner has already moved, is also a red flag to insurers. Standard homeowners policies often limit or exclude coverage on vacant properties, so a vacant-home endorsement or separate vacant policy may be required.

Prior Claims on the Property

A CLUE (Comprehensive Loss Underwriting Exchange) report tracks insurance claims filed on a property for up to seven years. Claims filed by a previous owner can affect your premium even if you purchased the home after the losses occurred. You can request and dispute your report once a year through the Lexis Nexis Consumer Portal.

Interested in learning more about what a CLUE report says about your risk profile? Watch this video to understand how insurance providers review your history and how it can affect your coverage options: 

What Personal Factors Raise Home Insurance Risk?

Your Claims History

Claims history doesn’t only matter for your property. Your personal claims history also follows you wherever you insure a home. Multiple claims in a short period, even smaller ones, can increase your risk level. A single water damage or fire claim within the past three to five years is a significant consideration. 

Your Credit Score

How often are you filing insurance claims? While insurance is built to protect you in such instances, a recent and frequent claims history can raise your premium or limit your options at renewal. Texas insurance carriers are also permitted to use credit-based insurance scores as a rating factor. A strong credit profile can meaningfully lower your premium. A poor one can raise it. 

Gaps in Coverage History

A lapse in home insurance signals that you may have gone without protection. Non-renewal by a prior carrier is itself a risk signal; other carriers will see that history and price accordingly.

Curious about what an insurance lapse actually is? Read Insurance Policy Lapses Explained to learn about how they happen (and how to prevent them).

What Do Home Inspectors Actually Look For?

Most homeowners don’t realize their home gets a physical inspection, not just a paperwork review. Nearly every carrier now sends someone out to check the exterior of your home when you write a new policy and again when you renew it. Homes valued over $1 million may also require an interior inspection.

Inspectors are typically looking at:

  • Fence condition
  • Siding (no chips, dings, or damage)
  • Fascia boards
  • Roof condition
  • Trees, bushes, or shrubs touching or overhanging the roof
  • Cracks in the driveway or sidewalk

Detached structures like sheds, carports, and barns are held to the same standard as the home itself. If any of these are in poor condition, they can trigger the same “high-risk flags” as a bad roof or foundation.

Image of 6 examples of home damage inspectors look for. Examples include: damaged fence panels, damaged fascia boards, chipped siding, flaking driveway pavement, stair-stepping siding cracks, and overhanging trees onto a home's roof.

Home Inspection Damage Examples

If an inspection turns up an issue, your carrier will typically give you a set window, often about 30 days, to fix it and submit photos or receipts as proof. Miss that deadline, and the policy can be cancelled. It’s a good reminder that “high risk” isn’t always about the big, obvious factors. Sometimes it’s an overgrown tree branch or a peeling fence.

What Happens if Your Home is Considered High-Risk? 

High-risk classification also affects what your policy will and will not cover. Some carriers respond by excluding specific threats or perils. 

A home with a 22-year-old composition roof may have wind and hail excluded, which are the exact perils most likely to cause a claim in West Texas. A home with prior water damage claims may have water damage sublimits that reduce your insurance payout significantly.

Understanding whether your policy has exclusions driven by your home’s risk classification is as important as understanding your premium, because the exclusion may mean the most likely claim you face is the one your policy will not pay.

How to Lower Your Home Insurance Risk Profile 

Some high-risk factors are fixed, such as your location, your home’s age, and your prior claims history. Others are addressable.

  1. Replacing an aging roof is the single most impactful property improvement for home insurance in West Texas. A new roof can restore full replacement cost coverage and eliminate wind and hail exclusions that some carriers impose on older roofs.
  2. Updating outdated electrical or plumbing systems reduces risk and can qualify your home for better underwriting terms. 
  3. Maintaining a clean claims record limits future surcharges. Before filing a small claim, calculate whether the payout justifies a multi-year premium increase.
  4. Improving your credit score directly affects your home insurance premium in Texas, even when nothing about your home changes.

Ready to get your insurance score in check? Watch this video to learn more about what your score says about you and how you can improve it: 

How to Lower Your Home Insurance Risk

There are a variety of factors that can make a home high risk: roof age, construction type, location, claims history, and credit score. Most homeowners who are overpaying have never identified which specific factor is driving the cost. That information gap is where unnecessary premium increases live, year after year.

The risk of doing nothing is real. Staying with a carrier that has classified your home as high risk, without shopping for alternatives or addressing the underlying factors, means paying more than you have to, potentially for coverage with exclusions you have never noticed.

Before your next renewal, ask your agent which specific factors are affecting your rate, whether any of them are addressable, and whether another carrier would price your home more competitively. 

Now that you understand what high-risk classification means, the next step is making sure you understand the full picture of your home coverage. Read Home Insurance vs Home Warranty: What’s the Difference? to understand how the two products work together and where each one falls short.

Grimes Insurance Agency has been helping West Texas homeowners understand and manage home insurance risk since 1948. We represent multiple top-rated carriers and will review your home’s specific risk profile to identify which factors are driving your rate and whether a better option exists in the current market.

Frequently Asked Questions

What makes a home uninsurable?

Most homes are insurable. However, homes with severely deteriorated roofs or significant prior water damage may be declined by standard carriers but can often be placed through non-standard or surplus lines insurers.

Does an old roof make a home high-risk? 

Yes. Roof age is one of the most heavily weighted factors in underwriting. In West Texas, an older roof can result in higher premiums, wind and hail exclusions, or actual cash value rather than replacement cost settlements on weather claims.

What should I do if my home insurance is non-renewed? 

Contact an independent agent immediately. Non-renewal means your current carrier declined to continue the policy. An independent agent can access carriers that specialize in higher-risk properties.

Disclaimer: The information provided in this article is for general informational purposes only and does not constitute legal, financial, or insurance advice. Coverage options, terms, and availability may vary. Please consult with a licensed professional for advice specific to your situation.