Texas · Master-Planned Community
Texas Master-Planned Community Insurance
A master-planned community community in Texas sits at the intersection of two coverage questions. The first is structural to the association type: coverage has to be layered correctly across a master association, its sub-associations, and any commonly owned amenity centers, so the same building or amenity is not double-insured or left uninsured between layers. The second is jurisdictional: Texas's statute, its lender-warrantability climate, and its market conditions shape how that program has to be sized, documented, and placed. This page covers both, and how they meet.
The coverage architecture
What drives a master-planned community master policy
A master-planned community's insurance architecture is defined by structure before it is defined by any single coverage line: there is usually a master association covering community-wide common areas and shared infrastructure, and one or more sub-associations (which may themselves be condo, townhome, or single-family HOAs) covering their own more localized common elements. The central design question is which layer insures what, entry monuments and main boulevards typically sit with the master association, while a sub-association's internal streets, a specific building, or a specific amenity cluster sit with that sub-association, and the governing documents for each layer need to say so explicitly and consistently with each other.
Where the layers are not coordinated, two failure modes both happen in the same communities: a shared amenity center, a large clubhouse, a golf operation, a water feature, gets insured by neither the master association nor any sub-association because each assumed the other carried it, or the same asset gets insured redundantly at both layers, which wastes premium without adding coverage. A programmatic review of a master-planned community has to map every shared asset to exactly one insuring layer before pricing anything, not after.
Once the layering is mapped, each layer's program looks structurally similar to a standalone association of that type, property, general liability, D&O, and fidelity, but the limits and the general liability exposure at the master level are usually larger because the master association's amenity centers (a large clubhouse, a golf or recreation operation, extensive common infrastructure) draw more foot traffic and carry higher replacement cost than any single sub-association's common elements. Directors and officers coverage needs to be placed separately at each layer too, because the master board and each sub-association board are legally distinct fiduciaries even when the same people sit on more than one of them.
- •Coverage gaps or duplication at a shared amenity center that no single layer clearly owns on paper
- •Master-association general liability for large, high-traffic amenities (clubhouses, golf or recreation operations, extensive common infrastructure)
- •Inconsistent governing-document language between the master association and sub-associations over which layer insures which asset
- •Directors and officers liability required separately at both the master and each sub-association layer
- •Fidelity/crime bond sized separately for the master association's typically larger reserve and assessment pool
- •Shared infrastructure (retention systems, entry boulevards, community-wide utilities) that spans multiple sub-association boundaries
Texas statutory backdrop
How Texas law shapes the program
For condominiums, Texas Property Code Section 82.111 requires the association to maintain property insurance on the insurable common elements against direct physical loss, including fire and extended coverage, in an amount of at least 80 percent of replacement cost or actual cash value, plus commercial general liability in an amount set by the board and the declaration. For condominiums with horizontal boundaries, stacked units, the property insurance must also cover the units.
That 80 percent statutory floor is the key practitioner point. It is below the 100 percent replacement-cost standard the Fannie Mae Selling Guide (section B7-3) requires for a conventional loan to be warrantable. A Texas association can satisfy the Property Code and still fail a lender insurance review, so the program should be sized to the lender bar, not the statutory minimum.
For the full Texas picture, including reserve and inspection requirements and market commentary, see the Texas state page. For how master-planned community coverage is built regardless of state, see the Master-Planned Community practice page.