Hotel insurance pricing in 2026 is a tale of two policies. The property side is the cheapest it has been in years and still falling. The liability side is tightening, shrinking limits, and attaching exclusions. If you only track your total premium, you will miss the fact that one half of your program is getting better and the other half is getting worse — and only one of those is under your control.
Is hotel property insurance actually getting cheaper?
Yes, and the published market commentary is unusually blunt about it.
Amwins’ State of the Market 2026 report on hospitality describes the property market as “firmly in a soft cycle,” driven by added capacity and a 2025 hurricane season with no continental U.S. landfalls. It reports that hotels “in favorable geographies are commonly achieving premium reductions in the range of 15% to 25%” — a striking reversal from earlier renewal cycles where increases “in some cases, exceeded 150%.”
Lockton’s February 2026 Real Estate and Hospitality Market Update describes hospitality property as “bottoming out,” consistent with the 5% to 10% renewal decreases it reports on nonhabitational assets.
The broader index agrees. Marsh’s Global Insurance Market Index for the second quarter of 2026 reports global commercial rates down 6% — the eighth consecutive quarterly decline — with property down 12% and casualty up 2% globally and 7% in the United States.
That last split is the whole story. If your renewal came back flat, your property premium probably fell and your liability premium ate the savings.
What determines a hotel’s property premium?
We are not going to publish a dollar-per-room benchmark, because no credible source supports a single Texas figure and the spread between a 1985 exterior-corridor property and a 2019 limited-service build is wide enough to make an average meaningless. Here is what underwriters actually rate on.
Total insurable value and how you calculated it
The single largest input, and the one most often wrong. Values set years ago and never trued up produce either a coinsurance penalty at claim time or years of overpayment. Get a current replacement cost valuation and use it.
Construction, age, and the four systems
Frame rates worse than joisted masonry, which rates worse than non-combustible. Within any construction class, underwriters ask the same four questions: roof, electrical, plumbing, HVAC. Documented replacement dates for those systems move rate more reliably than negotiation does.
Catastrophe exposure — in Texas, hail
Lockton identifies severe convective storms as the top natural catastrophe loss driver for insurers over the past decade and notes that severe convective storm activity has “tempered property insurers’ appetites for real estate risks in some states, such as Texas and Colorado.” That is why your wind and hail deductible is expressed as a percentage of value rather than a flat amount, and why that percentage deserves more attention than the rate.
Run the math before you accept it. TDI’s consumer guidance illustrates the principle at residential scale: a 5% deductible on a $150,000 structure is $7,500, so a $6,500 roof repair produces no payment at all. Scale that to a $12 million hotel and a 2% wind/hail deductible is $240,000 out of your own funds before coverage responds.
Protection and loss history
Sprinklers, alarm monitoring, distance to a responding fire station, and five years of loss runs. Amwins reports that guest-related fire claims led 2025 hospitality losses, ahead of water intrusion — a reversal worth knowing, and a reason kitchen hood systems, in-room appliance policies, and smoking enforcement carry weight in a submission.
Brand, flag, and operations
Franchise agreements often dictate minimum coverage and endorsement requirements. Full-service properties with restaurants, bars, banquet space, and pools carry more exposure than limited-service. Extended-stay and properties with significant contract or crew business get looked at differently again.
Why is the liability half going the other way?
Because hospitality casualty is where the industry’s severity problem lives.
Lockton reports that lead umbrella layers of $5 million are now common, that some insurers are offering only $2 million, and that $10 million lead layers are “difficult to obtain in the current casualty market.” It also reports liability insurers attaching exclusions on habitational, commercial, and hospitality properties for habitability, assault and battery, firearms, and liquor liability.
On sexual misconduct liability, Lockton is direct: SML exclusions “are common for hospitality risks and are likely to remain that way,” and underwriters “are paying close attention to crime scores when evaluating hotel portfolios.” At high-crime locations, assault and battery or sexual misconduct claims may be sublimited; in very high or extreme crime areas, properties “may see outright exclusions.”
So the answer to “how much does hotel insurance cost” increasingly has a second half: what does it cover once you have bought it?
How do you lower the number without hollowing out the policy?
Take the property savings, but check what funded them
A 20% property reduction achieved by moving from a 1% to a 3% wind/hail deductible is not a 20% reduction. It is a financing decision. Ask for the quote both ways and look at the retained loss in dollars.
Document the things that buy back liability coverage
Lockton spells out the ask: it is “imperative that hoteliers provide their insurance brokers details on training protocols and technology implemented to help prevent abuse, molestation, and human trafficking incidents from occurring at their locations, so insurance coverage can be put in place.” Amwins points the same direction, describing underwriting weight on crime scores, employee training — especially human trafficking awareness — expanded surveillance, and enhanced training programs.
In Texas this overlaps with the law. Chapter 114 of the Texas Business and Commerce Code requires lodging establishments offering more than 10 rooms to provide annual human trafficking awareness training of at least 20 minutes from an Attorney General—approved program, with new hires trained within 90 days, certificates produced to the Attorney General within 72 hours of request, and a posted sign of at least 11 by 17 inches in 16-point font or larger. You have to do it anyway. Putting the documentation in your submission converts a compliance cost into an underwriting asset.
Add cyber while it is cheap
Lockton reports cyber pricing stabilizing in 2026 with incumbent renewal quotes “predominantly flat.” Hotels take card payments and hold guest identity data, and neither property nor general liability responds to a breach. This is an unusually good year to add the coverage.
Market it properly, and start early
Ninety days out, with a current statement of values, five years of loss runs, updated system replacement dates, a security and training narrative, and photographs. Property carriers are competing for hotel risk in 2026. Give them a submission worth competing for.
If you own a hotel in Seguin, New Braunfels, San Marcos, or anywhere in Central Texas and your renewal did not come back with a property reduction this year, that is worth a conversation — either your submission is not telling the story, or something in the risk is doing it for you. Send us your declarations pages and loss runs and we will tell you which. Start with our hotel insurance page, or our broader hospitality insurance practice.
Related reading: What Does Hotel Insurance Cover?
