Living in Denison means you get the best of both worlds: small-town charm with big-lake recreation. You're minutes from Lake Texoma's 89,000 acres of water, you can walk the streets where President Eisenhower was born, and you've got Sherman right next door when you need more urban amenities. But here's what most Denison residents don't realize until it's too late: your insurance needs are shaped by geography in ways that can cost you thousands if you're not prepared.
In May 2025, Lake Texoma rose to 622.3 feet—more than 7 feet above its conservation pool—with water rushing in at 90,000 cubic feet per second. Businesses flooded. Boat ramps closed. Two people needed rescue from rising waters at the Denison spillway. If you thought "I'm not in a flood zone," that event probably changed your mind. This guide will help you understand what coverage you actually need, what you're wasting money on, and how to protect yourself in a city where the lake giveth and sometimes taketh away.
Why Denison's Location Makes Your Insurance Different
Grayson County sits right on the Oklahoma border, and Lake Texoma dominates the landscape north of town. That geography creates specific insurance considerations you won't find in, say, Austin or Houston. First, the lake. When people think "flood risk," they picture coastal storms or river valleys. But Lake Texoma is a reservoir—controlled by the Denison Dam—and when weeks of heavy rain dump more water than the dam can release, the lake rises fast. In 2025, it crested at 635.33 feet, just 4.5 feet below the spillway top.
Your standard homeowners policy excludes flood damage. Period. If Lake Texoma floods your property—whether you're lakefront or three miles inland—you're paying out of pocket unless you have a separate National Flood Insurance Program (NFIP) policy or private flood coverage. Many Denison homeowners assume their policy covers "water damage," and it does—but only from internal sources like burst pipes. External flooding? Not covered.
Second consideration: your proximity to Sherman and the Dallas-Fort Worth metro area affects auto insurance rates. Grayson County has over 100,000 registered vehicles, and with US-75 running straight down to DFW, you're sharing the road with a lot of commuters. More traffic means higher collision risk, which means higher premiums. The average Texas driver pays $212 per month for auto insurance in 2026—about 23% above the national average. In Denison, your rates will reflect both local traffic patterns and regional theft statistics.
What You Must Have vs. What You Should Have
Let's start with the legal requirements. In Texas, you must carry auto liability insurance—it's your proof of financial responsibility, and driving without it is illegal. That's non-negotiable across all of Grayson County's 100,000+ vehicles. Homeowners insurance, on the other hand, isn't legally required. But if you have a mortgage (and most people do), your lender requires it. Even if you own your home outright, skipping coverage is financial Russian roulette in a city that saw major flooding just months ago.
Here's what you should have, even if nobody's forcing you: replacement cost coverage on your home. Denison's median home value is $228,571 as of 2023, but that's market value—what someone would pay for your house. Replacement cost is what it would cost to rebuild from scratch if a tornado leveled it. With construction costs up significantly post-pandemic, your $230,000 home might cost $280,000 to rebuild. If you're only insured for market value, you're eating that $50,000 difference.
For renters—and yes, with a median rent of $1,161, there are plenty of you—renters insurance isn't required, but it should be. Your landlord's policy covers the building, not your stuff. More importantly, it doesn't cover your liability if someone gets hurt in your apartment. A $15-per-month renters policy gives you $100,000+ in liability coverage and replaces your belongings if there's a fire, theft, or covered water damage.
And then there's flood insurance. If you're anywhere near Lake Texoma or in a FEMA-designated flood zone, this isn't optional—it's essential. NFIP policies start around $400-$700 annually for homes outside high-risk zones, and they're worth every penny when the lake crests 13 feet above normal like it did in May 2025.
Auto Insurance: What Denison Drivers Need to Know
Texas requires liability coverage, but the state minimums are laughably low: $30,000 per injured person, $60,000 per accident, and $25,000 for property damage. If you cause a serious accident—say, you T-bone someone at the intersection of US-75 and FM-120—medical bills alone can hit six figures. Your $30,000 policy covers a fraction, and you're personally liable for the rest. Lawsuit, wage garnishment, the whole nightmare.
Better minimums: $100,000/$300,000/$100,000. It costs maybe $20-$40 more per month, and it actually protects your assets. Comprehensive and collision coverage are also worth considering, especially if you're still making payments on your vehicle. Collision covers damage from accidents; comprehensive handles theft, vandalism, hail, and hitting a deer on one of those back roads near the lake.
Uninsured/underinsured motorist coverage is critical in Texas, where about 1 in 8 drivers has no insurance despite the legal requirement. If someone without coverage hits you, your own UM/UIM policy covers your medical bills and car repairs. Given Grayson County's 100,000+ vehicles and proximity to Oklahoma (which has its own insurance rules), this coverage is non-negotiable.
Special Considerations for Lake Texoma Property Owners
If you own property on or near Lake Texoma—whether it's your primary residence or a rental cabin—you need specialized coverage beyond a standard homeowners policy. Flood insurance is the obvious one, but don't overlook windstorm and hail coverage. North Texas sees severe thunderstorms, and lakefront properties are often more exposed than homes in town.
If you rent out your lake property—even just on weekends or through Airbnb—your standard homeowners policy won't cover business activities. You need a landlord policy or a commercial policy with liability coverage for guests. If someone drowns in the lake near your property, or slips on your dock, you could face a massive lawsuit. Your homeowners policy will deny the claim because it was a rental. A proper landlord or short-term rental policy costs more, but it covers these scenarios.
Also consider boat insurance if you keep watercraft on the lake. Your homeowners policy might cover a small boat under personal property, but anything with serious value or horsepower needs its own policy. Liability coverage is especially important—if you're towing a skier and they hit a dock, you're on the hook for damages and injuries.
Business Insurance in Denison's Diverse Economy
Denison's economy runs on a mix of tourism (Eisenhower birthplace, Lake Texoma recreation), retail in the historic downtown, and service businesses. If you own a business here, your insurance needs depend heavily on your industry and location. A restaurant near the lake needs flood coverage and business interruption insurance—when Lake Texoma flooded in 2025, Island Bar and Grill had to close temporarily. Without business interruption coverage, you're losing revenue every day you're closed, with no compensation.
General liability insurance is the baseline for any business—it covers customer injuries and property damage. If someone slips in your downtown shop and breaks an ankle, your general liability policy covers their medical bills and legal defense. But general liability doesn't cover professional mistakes. If you're a contractor, real estate agent, or consultant, you need errors and omissions (E&O) insurance for professional liability.
Commercial property insurance covers your building and contents—inventory, equipment, furniture. If a tornado hits your downtown storefront, commercial property insurance pays to rebuild and replace your stock. And if you have employees, workers' compensation insurance is legally required in Texas once you have more than a certain number of employees (it varies by industry).
How to Get Started with the Right Coverage
Insurance feels overwhelming because there are a thousand variables and everyone's selling you something. Here's how to cut through the noise. First, get quotes from at least three insurers. State Farm consistently offers the lowest rates in Texas (around $132/month for auto), but USAA beats everyone if you qualify through military service. For home insurance, bundle your auto and home policies with the same company—most insurers give you 15-25% off for bundling.
Second, check your flood risk even if you think you're safe. FEMA's Flood Map Service Center lets you enter your Denison address and see your flood zone designation. If you're in a high-risk zone (Zone A or V), your lender will require flood insurance. But even if you're in a moderate- or low-risk zone, consider it anyway—May 2025 proved that Lake Texoma doesn't respect FEMA boundaries when it floods.
Third, review your coverage every year. Your home value might increase, your car might depreciate to the point where collision coverage isn't worth it, or you might buy a boat that needs its own policy. Life changes, and your insurance should change with it.
Denison is a great place to live—affordable homes, lake recreation, historic charm. But your insurance needs here are shaped by real risks: Lake Texoma flooding, higher-than-average auto rates, and the gap between what you think you're covered for and what your policy actually pays. Take an hour to review your policies, get quotes from multiple insurers, and add flood coverage if you're anywhere near the water. When the next storm hits and the lake starts rising, you'll be glad you did.
