Every two years, the Texas Windstorm Insurance Association’s board has to tell the Legislature what it wants changed. This year’s list — adopted October 8 and due in Austin by December 31 — is not routine. One of the four recommendations pays participating carriers a bonus for every risk they take off TWIA’s books. Another ends the policyholder’s right to refuse a private take-over offer. For Houston brokers, the depopulation program is about to stop being a state program that happens to touch their book and start being a program that negotiates with it. The 90th Legislature convenes in January. The time to understand the design is before a client’s renewal depends on it.
What the board actually voted for on October 8
The board adopted four recommendations for its biennial report. First, repeal — or make optional — the requirement that lawsuits against TWIA be heard by a judge appointed by the state’s multidistrict litigation panel; the board’s materials note that no litigant asked for such an appointment in the law’s first 14 years, and that since a 2024 Texas Supreme Court ruling in TWIA v. Pruski the association has sought the appointment in roughly 20 cases itself. Second, consider the feasibility and possible public funding of FORTIFIED construction — the Insurance Institute for Business & Home Safety’s beyond-code standard — and other mitigation programs. Third, repairs to the 2025 funding law, covered below. Fourth, and with the most direct effect on policyholders: a redesign of the Assumption Reinsurance Depopulation Program.
The depopulation redesign pays carriers per risk removed — and removes the client’s veto
Depopulation exists because TWIA was built as a last resort that kept growing. Under the current program, private insurers review TWIA policy data and offer to assume policies, and participation is voluntary at every step. It has collapsed as a market mechanism: carriers assumed 11,164 policies in the first round in 2016–17, then 57 in 2022–23, then none in the three years since. Two companies that took policies in earlier rounds, Weston and Maison, were placed into receivership in 2022, and TWIA had to write more than 12,000 of those policies back onto its own books.
The redesign has two moving parts. TWIA would be authorized to pay a bonus, per risk removed, to a participating carrier — the bonus, per the board, goes to the carrier taking the risk, not to the policyholder’s insurance agent and not to the client. The committee materials illustrated $100 for a barrier-island home, $75 within the first five miles inland, $50 at five to ten miles, and $25 beyond that, subject to a multi-year renewal requirement and Texas Department of Insurance approval. And a policyholder would become ineligible to renew with TWIA if a private insurer offers a comparable policy through the program. Current law caps a take-out offer at 115 percent of the TWIA premium; the board pointedly left the new premium-match percentage for the Legislature to set, after its own committee’s 20-percent draft drew fire.
That fire arrived before the vote. State Rep. Dennis Paul, whose southeast Harris County district sits on Galveston Bay, wrote the board on October 7 that he strongly opposes the design: “A family paying $4,000 annually for windstorm coverage could be forced to pay $800 more simply to maintain coverage.” Under the committee’s design, a homeowner would get notice and a short window to choose; not responding would transfer the policy, and declining could bar a return to TWIA for three years. None of this is law yet. All of it is now the association’s official ask.
How TWIA works in Harris County today
The mechanics your clients live under now: TWIA writes windstorm and hail only, in the 14 first-tier coastal counties plus La Porte, Morgan’s Point, Pasadena, Seabrook, and Shore Acres, where the property is inside the city limits and east of Highway 146. It is a last resort by construction — an applicant must first be denied by at least one private insurer — and a structure constructed, altered, remodeled, enlarged, repaired, or added to on or after January 1, 1988 must carry a Certificate of Compliance (WPI-8, WPI-8-E, or WPI-8-C), subject to the limited exceptions in Insurance Code sections 2210.251, 2210.252, 2210.258, and 2210.259. Everything else in the client’s exposure sits somewhere else: fire, theft, and liability go on a companion policy from the private market or the Texas FAIR Plan, and flood is a separate purchase entirely, usually through the National Flood Insurance Program. A Houston client “with TWIA” is a client with at least two policies and a gap analysis, whether anyone has run one or not.
The scale explains the politics. TWIA’s own budget materials project about 288,900 policies in force at the end of 2026 and $770.6 million in written premium for 2027, assuming no rate change. The catastrophe reserve trust fund — the layer after premiums and other revenue, and before state financing and member assessments — is forecast at roughly $59 million at the end of 2026. That balance sits in front of those later layers, which is why the funding law matters as much as the depopulation fight.
The 2025 money law underneath it
House Bill 3689, passed in June 2025, lets TWIA borrow up to $1 billion from the state after a catastrophe drains its reserve, and repay the loan through a surcharge on property insurance policies statewide, collected over no more than three years. Read that again as an inland broker: after the next major Gulf landfall, the repayment mechanism reaches policyholders who have never heard of TWIA. TWIA’s October recommendations ask the Legislature to repair two seams it found while implementing the law with TDI and the comptroller — the administrative lead time to stand up the surcharge may not leave a full three years to collect it, and the law forces the full surcharge process even when the amount owed is small, where TWIA would rather repay from its own premium revenue. The association is telling Austin, in writing, that the money machinery has rough edges. Houston’s excess wind losses can be financed by the whole state after the catastrophe reserve is depleted; expect the whole state to have opinions about it in January.
The energy book prices the same wind in a different market
A few miles from the subdivisions arguing over depopulation sits the other wind economy. Port Houston is the busiest port in the United States by total and foreign tonnage — 309.5 million short tons in the Army Corps of Engineers’ 2023 waterborne commerce data — and the petrochemical complex along the Ship Channel is one of the largest on earth. That exposure does not get a state association or a legislative ask. It buys named windstorm as a designated peril in the commercial and London markets, priced season by season.
The energy market has already voted on Gulf wind once. Oil Insurance Limited, the Bermuda mutual owned by the energy industry itself, announced in 2017 that it would eliminate its offshore Gulf of Mexico designated named windstorm coverage from January 1, 2018 — the industry’s own risk pool decided the peril no longer fit the mutual. What remains is priced capacity: London-market appetite guides still list “Gulf of Mexico Named Windstorm” as its own line of business, and drilling contractors’ own filings describe carrying Gulf named windstorm as the carved-out exception in otherwise insured fleets, with pieces self-insured. Same hurricane, two economies: on the residential side, wind cost is socialized through a state association and argued about in the Legislature; on the energy side, it is a line item that reprices every June 1. A Houston broker with both kinds of clients is working in both economies at once.
What to do before January
Inventory the TWIA book now, by distance band and renewal date. If the depopulation redesign passes anywhere near its proposed shape, the clients most likely to draw take-out offers are the ones you should already have a private-market answer for — because under the design, a client’s silence transfers the policy, and the conversation you did not have becomes the placement you did not make.
Keep the paper current. WPI-8 certificates, roof age and condition documentation, and any mitigation work are the difference between a client the private market wants and a client it declines — and if the FORTIFIED funding recommendation survives, documented beyond-code construction may soon carry public money behind it.
Brief your commercial clients with coastal locations on HB 3689’s surcharge mechanics before a storm does it for you, and watch for TWIA’s report on December 31: the premium-match percentage the Legislature is handed will decide whether depopulation-by-default is a gentle nudge or an $800 bill. Houston brokers do not get to sit this session out. The association already wrote them into it — as the ones who will have to move the policies — with the bonus paid to the carriers, not to them.
Sources: Texas Windstorm Insurance Association, board materials and October 8, 2026 meeting summary, as reported by The Texas Dispatch, October 15, 2026; House Bill 3689, 89th Texas Legislature (2025); Texas Insurance Code ch. 2210 (TWIA eligibility, depopulation, 115% take-out cap); TWIA eligibility and WPI-8 guidance; letter of Rep. Dennis Paul to the TWIA board, October 7, 2026; U.S. Army Corps of Engineers, Waterborne Commerce Statistics (2023 port tonnage); Oil Insurance Limited, announcement of elimination of offshore Gulf of Mexico designated named windstorm coverage, February 2017 (effective January 1, 2018).