Texas’ roughly $300 billion manufacturing sector continues growing, although at a slower pace in March 2026 than it did the month before amid increased uncertainty, according to data released by the Federal Reserve Bank of Dallas.
The good news is that expectations, according to the Dallas Fed, are for increased manufacturing activity in Texas over the next six months. The state continues to see reshoring projects filling up industrial parks, and high-tech investments from companies like Apple and Nvidia, that are rewriting Houston’s identity as a manufacturing hub.
Growth also brings risk. And for Texas manufacturers navigating reshoring, robotics adoption, and an increasingly digital operational landscape, the insurance implications are just as significant as the business opportunities. Here is what manufacturers should be thinking about as they plan for 2026 and beyond.
The reshoring trend is accelerating across Texas. Roughly one-quarter of all industrial space absorption in the state is tied to manufacturing, and major capital-intensive projects continue to break ground. A $365 million cable manufacturing facility near Houston is among the high-profile developments slated for 2026.
For insurers and policyholders alike, this expansion raises important questions:
Manufacturers should treat every expansion as a trigger to review and update their coverage.
Collaborative robots, commonly known as cobots, are one of the fastest-growing segments in industrial automation. Unlike traditional industrial robots that operate behind safety cages, cobots are designed to work directly alongside human employees in shared workspaces. The cobot market is projected to reach nearly $10 billion by 2027, and Texas manufacturers are rapidly adopting robotic technologies as part of a broader shift toward advanced, automated production.
The safety profile of cobots is nuanced. On one hand, cobots reduce exposure to many of the injuries that have historically driven workers' compensation claims in manufacturing. They handle repetitive lifting, awkward positioning, and sustained overhead work, reducing the incidence of musculoskeletal disorders and repetitive strain injuries.
On the other hand, research from South Korea's manufacturing sector, published in the journal Technological Forecasting and Social Change, found that firms using cobots experienced an increase in certain types of industrial accidents, particularly during the transition period when workers are adjusting to shared human-robot workspaces.
For Texas manufacturers, the workers' compensation implications include:
Manufacturers adopting cobots should proactively engage their insurance advisors to assess how automation changes their risk profile and whether their current workers' comp program reflects that reality.
The same technologies that make Texas factories more efficient also make them more vulnerable. IoT sensors, AI-driven analytics, digital twins, and connected production systems all create entry points for cyber threats. Ransomware attacks, phishing schemes, and supply chain infiltrations can halt production lines and compromise sensitive data.
For manufacturers, cyber risk is no longer an IT problem. It is an operational risk with direct financial consequences.
Many standard cyber liability policies were designed with IT environments in mind: email systems, databases, customer records. But manufacturing cyber risk increasingly involves OT systems, such as programmable logic controllers, SCADA systems, and connected production equipment. Manufacturers should confirm that their cyber coverage extends to OT environments, where a breach can shut down physical production rather than just compromise data.
Since September 1, 2025, Texas Senate Bill 2610 has provided a cybersecurity safe harbor for businesses with fewer than 250 employees. Under the law, a business that implements and maintains a qualifying cybersecurity program aligned with recognized frameworks (such as NIST or ISO/IEC 27001) can be shielded from punitive damages in data breach litigation. However, this protection is not automatic. It requires documented compliance at the time of the breach.
For small and mid-sized manufacturers in Texas, SB 2610 creates a clear incentive: invest in a documented cybersecurity program, and you gain meaningful legal protection. Fail to do so, and you remain exposed to punitive damages on top of compensatory losses.
Manufacturers should review their cyber policies alongside their SB 2610 compliance efforts. A well-structured cybersecurity program may not only qualify for the safe harbor but also position the business for more favorable cyber insurance terms and premiums.
The manufacturing workforce is in flux. The Manufacturing Institute projects that nearly half of the 3.8 million manufacturing positions expected to open nationwide over the coming decade could go unfilled. Texas manufacturers are responding with apprenticeship programs, reskilling initiatives, and competitive compensation packages to attract younger workers.
These workforce shifts have insurance implications that are easy to overlook:
Texas manufacturers are building something significant: new facilities, new capabilities, and a new chapter for the state's industrial economy. But the risks are evolving just as fast as the opportunities.
From workers' comp implications of human-robot collaboration to the cyber liability landscape reshaped by SB 2610, the manufacturers best positioned for 2026 are those treating their insurance strategy as a competitive advantage rather than a line-item expense.
At Dean & Draper, we work with Texas manufacturers to build insurance programs that keep pace with growth, technology adoption, and the evolving risk environment. Contact us today to schedule an insurance review tailored to your manufacturing operations.