Most Texas hotel property policies do not use a flat dollar deductible for wind and hail. They use a percentage of the insured value, usually somewhere between 1% and 5%. On a hotel insured for $12 million, a 2% deductible means the first $240,000 of a hail claim is yours. Many owners do not realize that until the adjuster is on the roof.
Below is how these deductibles work, why they have become standard in Texas, and what you can do before the next storm season to keep a covered loss from turning into a cash problem.
Because Texas has more hail claims than any other state, and carriers price for that. In the National Insurance Crime Bureau's study of 2016 through 2018 claims, Texas had more than twice as many hail claims as the next state, and San Antonio was the top city in the country. The weather has not slowed down since. State Farm alone reported paying $1.4 billion in Texas hail claims in 2025, more than in any other state.
A percentage deductible shifts the frequent, smaller storm losses back to the owner so the carrier can keep offering capacity for the large ones. For a hotel, where the roof, HVAC units, and exterior finishes represent a large share of the building's value, that shift is significant.
The deductible is a percentage of the insured value, not a percentage of the claim. That distinction is the one that catches people.
Here is a simple example. Your hotel building is insured for $12,000,000 with a 2% wind and hail deductible. A hailstorm causes $310,000 in roof and exterior damage.
If the same storm caused $200,000 of damage, the carrier would pay nothing. The loss would sit entirely inside the deductible.
Three details in the policy language decide how large that number gets:
No. A named storm deductible applies only when the damage comes from a storm the National Weather Service has named, which mostly matters for hotels closer to the coast. A wind and hail deductible applies to any wind or hail event, including the spring storms that do most of the damage in Central Texas. Some policies carry both. If your hotel is in one of the coastal counties where the Texas Windstorm Insurance Association writes coverage, the structure looks different again. For inland properties in Guadalupe, Comal, Bexar, and Hays counties, the wind and hail deductible is the one that matters.
It can. Some policies apply the percentage only to direct physical damage. Others combine property and business income into one calculation. If a storm forces you to close a wing for repairs, read whether lost room revenue is subject to its own waiting period, the percentage deductible, or both. This is worth confirming before a loss, not during one.
The deductible is only one piece. A few other provisions often show up on Texas hotel policies:
You have more options than simply accepting the deductible your renewal offers.
Percentage deductibles between 1% and 5% of insured value are common in Texas, often with a dollar minimum. The exact number depends on the carrier, the property's location and construction, and the roof.
Sometimes, usually at a higher premium. Availability depends on the market and the property. It is worth asking for at every renewal.
Often, yes. Many franchise agreements and loan documents cap the deductible an owner can carry. Check both before agreeing to a higher one.
The time to find out what your wind and hail deductible really costs is before spring, not after. If you own or operate a hotel in Guadalupe, Comal, or the surrounding counties, send us your current property declarations page and we will show you what your deductible would be on a real claim and what your options are to change it. Call 830-303-8300 or visit our hotel insurance page.