Here's something that catches most new pool service business owners off guard: Texas doesn't actually require you to carry general liability or workers' compensation insurance. You can legally operate without either one. But here's the catch—just because you can doesn't mean you should. The real question isn't whether Texas requires it, but whether you can afford to operate without it.
If you're servicing pools in Texas, you're dealing with electrical equipment, hazardous chemicals, and other people's expensive property. One mistake—a pump installation that causes flooding, a chemical mix-up that damages a pool surface, or an employee injury while hauling equipment—could cost you tens of thousands of dollars. Let's walk through what you actually need to know about insurance requirements, licensing, and protecting your business in the Lone Star State.
Texas Licensing Requirements for Pool Service Contractors
If you're just skimming leaves and testing chemicals, you don't need a license in Texas. But the moment you start installing or repairing pool equipment—pumps, filters, heaters, underwater lights, motors—you need a Residential Appliance Installer License (RAIL) from the Texas Department of Licensing and Regulation (TDLR). The contractor-level version is called RAIC (Residential Appliance Installer Contractor), formerly known as TICL.
This isn't a rubber-stamp license. You'll need to pass a state-administered exam covering the National Electrical Code as it applies to pools. The pass rate hovers around 28%, so it's not something you walk into unprepared. And here's where insurance enters the picture: TDLR requires licensed contractors to carry business liability insurance as part of maintaining your license. So even though Texas doesn't mandate insurance for unlicensed pool cleaning, if you want to legally repair equipment, you must have coverage.
Operating without the proper license? TDLR fines start at $2,000 per occurrence. Get caught a few times and you're looking at serious money, not to mention the reputational damage when customers find out you're not properly licensed.
General Liability Insurance: The Safety Net You Actually Need
General liability insurance covers you when things go wrong during normal business operations. A client slips on a wet pool deck during your service visit and breaks an ankle. You accidentally crack a tile while replacing a skimmer. Your truck backs into a gate and damages the fence. These aren't hypothetical scenarios—they happen regularly in this industry.
The industry standard for pool service businesses is $1 million per occurrence and $2 million aggregate. This means your policy will cover up to $1 million for any single incident and up to $2 million total for all claims during your policy period. In Texas, this level of coverage typically costs between $67 and $89 per month, or around $800 to $1,070 annually. That's less than most pool service companies charge for a single equipment replacement job.
Even though Texas doesn't require general liability insurance by law, you'll find it's practically mandatory. Many commercial clients won't hire you without proof of insurance. Homeowner associations typically require it. Property management companies demand it. And smart homeowners ask for it. If you can't produce a certificate of insurance, you're losing work to competitors who can.
Workers' Compensation: The Texas Exception and Why It Still Matters
Texas is the only state in the U.S. that doesn't require most private employers to carry workers' compensation insurance. If you're running a pool service company with employees, you can legally operate as a "non-subscriber"—meaning you choose not to carry workers' comp coverage. But before you celebrate the cost savings, understand what you're trading.
When you carry workers' compensation, it covers your employee's medical expenses, lost wages, and rehabilitation costs if they get hurt on the job. In exchange, they generally can't sue you. When you don't carry it, injured employees can sue you directly in civil court. They can go after not just medical bills but pain and suffering, lost future earnings, and punitive damages. A single serious injury—say, an employee falls off a ladder while accessing rooftop equipment or gets shocked working on pool electrical systems—could bankrupt your business.
Workers' comp for pool contractors in Texas typically costs between $400 and $3,000 annually, depending on your payroll size and employee count. That's often less than you'd pay in legal fees just to defend a lawsuit, let alone the potential judgment. And here's where it becomes mandatory: if you contract with government entities, you must provide workers' compensation coverage for employees working on those projects. Many large commercial clients require it as well.
Commercial Auto Insurance and Other Essential Coverage
Texas requires commercial vehicles to carry minimum liability limits of $30,000 per injured person, $60,000 per accident, and $25,000 for property damage. But these minimums are woefully inadequate for pool service businesses. You're hauling expensive equipment, potentially hazardous chemicals, and driving to multiple job sites daily. A serious accident could easily exceed these limits.
Consider commercial auto coverage that matches your general liability limits—at least $1 million. You should also think about inland marine insurance (which covers your tools and equipment while in transit) and commercial property coverage if you operate out of a physical location. These aren't legally required, but they protect the assets you've built your business around.
How to Get Properly Insured and Licensed
Start by determining what services you'll offer. If you're doing equipment installation and repair, begin studying for the RAIL exam through TDLR. You'll need to demonstrate knowledge of electrical codes specific to pool systems. While you're preparing for the exam, contact insurance agents who specialize in contractor coverage. They understand the pool service industry and can package the right combination of coverages for your specific operation.
When comparing insurance quotes, don't just look at the premium. Check the coverage limits, deductibles, and exclusions. Ask about discounts for bundling multiple policies or for maintaining a clean claims history. Many insurers offer business owner's policies (BOPs) that combine general liability and commercial property coverage at a lower rate than buying them separately.
Once you're licensed and insured, verify your technician licenses through the TDLR website to ensure everything's current. Keep digital copies of your insurance certificates handy—you'll need to provide them regularly to clients. Set calendar reminders for license and policy renewals so you never operate with lapsed coverage. The few hundred dollars you spend monthly on insurance is nothing compared to the risk you're taking without it.
