Plumbing Contractor Insurance In Texas

Running a plumbing business in Texas comes with significant financial risks. You need insurance to protect your livelihood. Whether you are dealing with slab leaks in Houston, frozen pipes in the Panhandle, or new construction in Austin, a single mistake could lead to massive water damage claims that seize your personal assets and shut down your company.

Additionally, to maintain your license with the Texas State Board of Plumbing Examiners (TSBPE), you are strictly required to carry specific insurance limits. You cannot pull permits or operate legally as a Responsible Master Plumber (RMP) without it.

This guide breaks down exactly what coverage you need to stay in business, the specific legal risks of operating as a plumber in Texas, what it costs, and which carriers are best suited for the job.

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The Essential Coverages

Although some large mechanical contractors need complex additions, these are the basics and best practices that most plumbing contractors need to cover their risks and comply with state and job site requirements.

1) General Liability

General Liability is the core insurance policy that every plumber needs. It is the foundation of your risk management and a requirement for your RMP designation.

• What it covers: Bodily injury to third parties and property damage. For plumbers, this is critical. If a solder joint fails causing a flood, or your torch accidentally ignites insulation behind a wall, this policy pays for the repairs and legal fees.
• The standard requirements: Most commercial contracts require $1,000,000 per occurrence / $2,000,000 aggregate limits.
• Critical for plumbers: You must ensure your policy includes "Products & Completed Operations". If you install a water heater today and it leaks next year causing mold and floor damage, this is the only coverage that pays out.

2) Workers' Compensation

Texas allows private employers to "opt out" of Workers' Comp, but for plumbing contractors, this is rarely a good idea due to the physical nature of the work.

• The Risk: Plumbing involves heavy lifting, working in trenches, and exposure to hazardous materials. If an apprentice injures their back installing a cast iron tub or is crushed in a trench collapse, you are liable.
• What opting out means: If you opt out and get sued by an injured employee, you lose your common-law defenses. You cannot argue the employee was clumsy or knew the risks. If you are 1% at fault, you pay 100% of the damages.
• Contractual Necessity: Most general contractors will refuse to hire plumbing subs who do not carry true Workers' Comp.

3) Commercial Auto

Plumbers live in their vans. Whether you have a single work truck or a fleet of service vans, this is one of the few coverages strictly enforced by Texas state law.

• Personal vs. Commercial: If you are in an accident while hauling pipe or have employees driving your truck, your personal insurer will likely deny the claim. Commercial vehicles with racks, lettering, and heavy tools need a commercial auto policy.
• Recommended Limits: Aim for a $1,000,000 limit, especially if you drive heavy box trucks or if you have an umbrella policy with a minimum limit requirement.

4) Inland Marine (Tools & Equipment)

Your livelihood is in the back of your truck. A general liability policy does not cover your tools if they are stolen.

The solution: An "Inland Marine" (or tool floater) policy follows your expensive equipment—like sewer cameras, ProPress tools, and jetters—wherever they go.

Theft Risk: Plumbing vans are frequent targets for theft because items like copper pipe and Milwaukee tools are easily resold. This policy replaces them so you can get back to work.

License-Specific Insurance Requirements

The Texas State Board of Plumbing Examiners (TSBPE) has "hard-coded" insurance limits required to maintain an active Responsible Master Plumber (RMP) designation.

Responsible Master Plumber (RMP) Requirements: To secure your RMP designation and pull permits, you must submit a Certificate of Insurance (COI) to the TSBPE verifying:

• Minimum Limit: $300,000 in Commercial General Liability coverage.
• Coverage Scope: The policy must cover claims for property damage and bodily injury, regardless of whether the claim arises from negligence or a contract claim.
• Policy Period: You must maintain this coverage continuously. If it lapses, your ability to pull permits is revoked immediately.

Estimated Annual Costs

Below are example annual premiums for a plumbing contractor in Texas. These figures assume standard coverage limits ($1M GL, WC, and Auto) for a stable, established plumbing business with approximately $1,000,000 in annual revenue.

Note: Smaller, one-man shops will pay significantly less—often starting around $900/year for General Liability.

Real-World Claim Examples

1. The Slow Leak (General Liability)

Scenario: A plumber in Dallas installs a second-story bathroom vanity. A P-trap fitting is slightly loose. Over the course of three weeks, water drips unnoticed behind the cabinet, rotting the subfloor and ruining the ceiling in the living room below.
Outcome: The General Liability policy pays $45,000 for remediation, floor replacement, and drywall repairs. Crucially, the Completed Operations coverage pays this, since the plumber had already left the job site weeks ago.

2. The Trench Collapse (Workers' Comp)

Scenario: A plumbing crew is excavating a sewer line replacement in a yard. The trench walls are not properly shored, and the ground shifts, partially burying an apprentice.
Outcome: Workers' Comp pays $65,000 for surgery, rehabilitation, and lost wages. Because the employer carried true Workers' Comp, the employee is barred from suing the plumbing company for millions in "pain and suffering."

3. The Van Break-In (Inland Marine)

Scenario: A service plumber parks outside a supply house. While inside, thieves break the lock on the back doors and steal a sewer camera ($8,000) and a pressing tool kit ($3,000).
Outcome: General Liability pays nothing for your own property. The Inland Marine policy pays $11,000 (minus deductible) to replace the specific tools listed on the policy schedule.

Best Insurance Companies for Texas Plumbers

1. LandesBlosch

Best For: Plumbers seeking multiple quotes & expert guidance
Why: As a specialized independent broker, LandesBlosch isn't tied to one insurance company. They partner with all the major carriers (including Chubb, Travelers, and The Hartford) to shop the market for you. From specific endorsement request to high limit policies, they can help you get on the job site and not worry about insurance.

2. Chubb

Best For: Small Plumbers
Why: Chubb’s "Contractors Liability Enhancement" is excellent for plumbers. It often includes coverage for all you additional insured requests wrapped up into a single low-cost endorsement. Their claims service is top-tier, which matters when you are dealing with water damage.

3. The Hartford

Best For: Small and Mid-Sized Commercial Plumbing Contractors
Why: The Hartford is a standard for the trades. They have a deep understanding of contractors and offer a "bundled" product that can easily combine your Auto, GL, and Tools into one bill. They are widely accepted by General Contractors for certificate requirements.

4. Berkley Aspire

Best For: Plumbers doing higher risk work (e.g. utilities, industrial, or high-rise buildings)
Why: Many standard carriers refuse to insure plumbers who work on anything but the lowest risk projects. Berkley Aspire can underwrite a lot of the higher hazard work that other carriers won't offer coverage for.