Mortgage · A nickname for the dwelling policy
Hazard insurance is the lender’s name for coverage on the house, the collateral. It is not flood, it is not private mortgage insurance, and this page will not invent the year the phrase started.
In older fire policies, a peril was the cause of loss and a hazard was a condition that made that loss more likely. Lenders kept the word hazard for the policy that pays to repair or rebuild the building after a covered cause, fire, wind, hail, and the rest of the form. On a modern closing that policy is usually an HO-3: open-peril on the dwelling, named-peril on contents, with flood excluded either way. Texas does not make homeowners insurance compulsory the way it makes auto liability compulsory. The mortgage does, by contract. The limit the lender requires protects the loan. It is not automatically a full rebuild.
The two bills people mix up: mortgage insurance versus homeowners. Whether the state requires it: is home insurance required in Texas. What the form pays: what Texas homeowners covers, coverage overview, home and household, and policy types. The water it leaves out: flood, including inland.
