Moon Insurance Managers, Inc. · TDI license #5595

HVAC Contractor Insurance in Texas

Texas sets a general liability minimum for licensed air conditioning and refrigeration contractors, and the number depends on your license class. This page gives the exact figures, what TDLR will and will not accept as proof, what the schedule lists for a lapse, and where a city or a customer asks for something different.

What’s required: to contract with the public, a TDLR Class B license calls for at least $100,000 / $200,000 / $100,000 in general liability, and Class A at least $300,000 / $600,000 / $300,000.

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TDLR, Class A and Class B

What Texas requires of an HVAC contractor

Texas law says a person may not engage in air conditioning and refrigeration contracting without a contractor license, apart from the exemptions it lists. “Contracting” includes performing or offering to perform design, installation, repair, maintenance or service on these systems. Evidence of insurance is a condition of getting that license.

The minimums follow the class:

TDLR general liability minimums by air conditioning and refrigeration contractor license class
Criterion	Class B	Class A
Scope	Up to 25 tons of cooling or 1.5 million BTU an hour of heating	Any size
Per occurrence (bodily injury and property damage combined)	$100,000	$300,000
Aggregate (bodily injury and property damage)	$200,000	$600,000
Aggregate, products and completed operations	$100,000	$300,000

The rule says this insurance must be kept “at all times during a license period” and must come from an insurer authorized to sell liability insurance in Texas. TDLR’s Chapter 75 amendments effective September 1, 2026 did not list this section. How the policy itself works is on the general liability insurance page.

These are licensing floors. They do not tell you what a contract will ask for.

Sources: Tex. Occ. Code §§ 1302.002, 1302.251, 1302.253, 1302.260; TDLR contractor page; Form ACR-LIC-009, rev. Oct 2025; 16 TAC § 75.40 (Cornell LII mirror, which can lag the official code); TDLR adoption notice, 51 TexReg 5778. Verified 30 October 2026.

The one exception is a waiver. The executive director may waive the requirement for a license holder who does not contract for the public, on a written request with a detailed explanation. The rule says a licensee holding a waiver cannot perform or offer to perform contracting with the general public under that license.

Sources: Tex. Occ. Code § 1302.102; 16 TAC § 75.40(e), (f) (Cornell LII mirror); TDLR renewal page. Verified 30 October 2026.

The certificate

Getting proof to TDLR, and keeping it current

After you pass the licensing exam, TDLR says you must submit a certificate of insurance showing the license holder name and the business name. It can go to customer service by email, through TDLR’s Contact Us page.

TDLR has its own form, ACR-LIC-009, with TDLR as certificate holder. Three details on it matter:

“Binders or Declarations are not Accepted.” Those words are printed under the policy number line.
An authorized insurance representative certifies it. That person signs that the policy meets or exceeds the minimums.
Your insurer is asked to tell TDLR about a cancellation. The form says the carrier “shall endeavor to notify” TDLR at least 30 days before a cancellation or non-renewal by the carrier, and not more than 10 days after one by the insured.

Three events change what you owe TDLR:

Your company name changes. The rule asks for a revised certificate within 30 calendar days.
You move from Class B to Class A. TDLR says your insurance requirements change with it.
You hold both classes. One policy can serve both, if it meets the Class A minimums.

Sources: TDLR contractor page; Form ACR-LIC-009, rev. Oct 2025; TDLR renewal page; 16 TAC § 75.40(d) (Cornell LII mirror); 16 TAC § 75.70(h)(2) (Cornell LII mirror). Verified 30 October 2026.

For a certificate on a policy already in force, use the certificate request page.

TDLR’s penalty schedule

What the schedule lists if coverage lapses

TDLR’s penalty schedule puts these in its Class C, the same range for each: “$2,000 to $5,000 and/or 1-year probated suspension up to revocation”. Penalty classes are TDLR’s own scale and have nothing to do with your license class.

Failing to maintain insurance
Buying from a company not authorized to sell liability insurance in Texas
Failing to give TDLR proof of insurance when it asks
Failing to give a consumer insurance information when asked
Contracting with the public while holding a waiver

A revised certificate that misses the 30-day window sits in the schedule’s Class A: $500 to $1,000. This is what the schedule lists. It does not predict what happens in any one case.

Your customer can ask, too. Under the rule, a licensee must give any customer who requests it the insurance carrier’s name, the policy number, and the agent’s name, address and telephone number.

Sources: TDLR air conditioning and refrigeration penalty schedule; 16 TAC § 75.40(g) (Cornell LII mirror). Verified 30 October 2026.

Beyond TDLR

Cities and contracts can ask for something different

A certificate that satisfies TDLR does not automatically satisfy anyone else. State law lets a city require notice from a licensee, and each city page reads differently. These are the ones we read, not a statewide list, so check with the permit office wherever you work.

Houston has a separate registration with its Mechanical Section, and it takes its own certificate, with the City of Houston Mechanical Section as holder. Your name and license number must appear as “insured” or “additional insured”. The registration lasts one year and renewal needs the certificate again. The page prints no dollar limit. To get an inspection, Houston says your license, insurance and registration must be in good standing.
San Antonio asks for a certificate or proof of liability insurance to register a state license, and leaves the amount for state licenses to TDLR’s rule.
Gainesville asks every registering contractor for a certificate showing $1,000,000 per occurrence, with the city as holder. That is above both TDLR classes.
Orange asks mechanical contractors for a certificate showing a minimum of $300,000 in general liability. That is above the Class B floor.

Sources: Tex. Occ. Code § 1302.262; Houston Permitting Center, code 1012, undated; Houston Permitting Center, code 1032, undated; San Antonio DSD; City of Gainesville; City of Orange. Verified 30 October 2026.

Customers set their own numbers. Eanes ISD’s published requirements for vendors and contractors, for example, ask for $1,000,000 general liability per occurrence. They add $500,000 auto liability if you own vehicles or transport anything onto school property, and $100,000 workers’ compensation if you have hired staff or contract out manual labor there. The district must be certificate holder and additional insured, on an ACORD certificate.

Source: Eanes ISD. Verified 30 October 2026.

We did not find a published Texas requirement from a property manager, HOA, landlord or general contractor for HVAC work. So read the clause in the contract in front of you. What additional insured status means is covered on the contractors insurance page, and the certificate guide for Houston contractors goes through the paperwork.

Beyond general liability

What else an HVAC business looks at

General liability is the only line TDLR’s insurance rule sets. The others come from what you own, who you employ and what you sign.

The van. A work van raises a commercial auto question of its own. One carrier’s published example is a technician who runs a red light and hits another car.
Tools and staged equipment. Ask how tools in the van and units waiting to be installed are treated, and whether an installation floater applies. The commercial property page covers owned equipment.
Your crew. Workers’ compensation is elective for most private employers in Texas, so it is usually a contract or business decision. A governmental entity’s building or construction contract is different: it must require written certification of coverage for each employee on the public project. Start at workers’ compensation insurance.
A contract limit above your policy. One carrier’s illustration has a fire, a $1.5 million demand and a $1 million general liability limit. An umbrella is one way to meet a higher limit.
Design work. Design is part of licensed contracting in Texas, and the rule bars subcontracting it to an unlicensed person. If you size systems or lay out ductwork, ask whether design errors need professional liability.

The examples above are illustrations from insurers and agencies. We did not find loss data for HVAC contractors, so this page does not say which claim is most common. EPA Section 608 technician certification is a federal credential, not an insurance requirement.

Sources: Tex. Lab. Code §§ 406.002, 406.096; Tex. Occ. Code § 1302.002; 16 TAC § 75.70(c) (Cornell LII mirror); insurer’s illustrative scenarios; EPA Section 608. Verified 30 October 2026.

Compare like for like

Questions to ask before you accept a policy

To compare two HVAC quotes like for like, look past the limits and ask the same questions of each, and get the answers from the policy wording rather than the certificate. TDLR’s own form says the terms of the policy control over the certificate.

Refrigerant. How does the pollution exclusion treat a refrigerant release from my work? Is there an exception, or do I need separate pollution coverage? Agency pages make claims on this, none citing a policy form, and we are not stating an answer here.
Carbon monoxide. How would a claim traced to a flue or heat exchanger I worked on be treated?
Mold after a water loss. Is it limited or excluded?
Hot work and roofs. Are brazing or rooftop work excluded or limited on this policy?
Crane lifts. Who covers a unit while it is being lifted to the roof?
Spoilage. If my refrigeration work fails, how is a customer’s lost inventory treated?
Residential or commercial. Does the policy limit either one, and does my class of work match what the application describes?
Finished jobs. Are products and completed operations included at the limit TDLR requires, and if I switch policies, how would each one respond to a job finished before the switch?

Source: Form ACR-LIC-009, rev. Oct 2025. Verified 30 October 2026.

Who the rule reaches

LLCs, side work and who is liable

An LLC is not in the rule. The insurance requirement is written for licensees, and the text we read has no exception for a one-person company or an LLC. The only route around it is the waiver, which rules out contracting with the public. Whether an LLC protects your personal assets is a question for a lawyer.

Side work is contracting too. The statute covers performing or offering to perform the work, and the exemptions are specific ones listed in the statute, such as a home you solely own or a portable ductless unit of three tons or less. If you are a technician who does jobs on your own time, do not assume your employer’s policy follows you. Ask your employer’s agent, and ask about the license at the same time.

If you subcontract licensed work to an unlicensed person or firm, the rule says the licensee is ultimately responsible to the customer for all work the subcontractor performs. Whether your policy responds is a separate question for your agent.

If you are an employee worried about being personally liable, that is a legal question this page cannot answer. Take the specifics to a lawyer.

Sources: Tex. Occ. Code §§ 1302.002, 1302.053 to 1302.061, 1302.251; 16 TAC § 75.30 (Cornell LII mirror); 16 TAC § 75.40 (Cornell LII mirror); 16 TAC § 75.70(b)(3) (Cornell LII mirror). Verified 30 October 2026.

Not legal advice.

No obligation

Tell us your class and what the contract asks for

Moon Insurance is an independent agency on FM 1959 in southeast Houston. Moon places general liability for HVAC contractors. Send your license class, whether your work is residential or commercial, and any contract or city insurance clause with the inquiry, and the first call can start from the requirement. Whether a given market fits your work is answered on a submission, not on this page. The phone is fastest: (281) 484-8320, or use the form below.

Monday to Thursday, 9:00 to 5:00; Friday, 9:00 to 4:00. Our Houston office is the place to start, at 360 FM 1959, Houston, TX 77034.

HVAC contractor insurance questions

Does an HVAC contractor need insurance in Texas?

Yes, if you hold a TDLR contractor license and contract with the public. The rule says licensees must keep the insurance at all times during a license period. A waiver exists for a holder who does not contract for the public, and it bars public work under that license.

How much insurance does an HVAC contractor need in Texas?

It depends on the class. Class B is at least $100,000 per occurrence, $200,000 aggregate and $100,000 products and completed operations. Class A is at least $300,000, $600,000 and $300,000. A city or contract can ask for more.

Can I send TDLR my declarations page or a binder?

Not on TDLR’s certificate form: ACR-LIC-009 says “Binders or Declarations are not Accepted”. The rule refers to a certificate “or other evidence satisfactory to the department”, so ask TDLR before sending anything else.

When do I file the certificate?

After you pass the licensing exam, according to TDLR. The rule also asks for it when you change a business name or affiliation and whenever TDLR requests it.

What happens if my HVAC insurance lapses?

TDLR’s schedule lists failing to maintain insurance as a Class C violation: “$2,000 to $5,000 and/or 1-year probated suspension up to revocation”. The outcome in a given case is TDLR’s to decide, and this page does not predict it.

Does general liability cover a refrigerant leak?

We are not giving a yes or no here, because the answer depends on the pollution wording in the policy. Ask how that exclusion treats a release from your work, and read the answer in the policy itself.

How much does HVAC contractor insurance cost?

There is no honest single figure. The price follows the operation, so have your class, residential and commercial split, crew size, subcontractors, design work and rooftop work ready. The van is its own question.

Do I need workers’ comp as an HVAC contractor in Texas?

Not by default: coverage is elective for most private employers. A contract can require it, and a governmental entity’s building or construction contract must require certification of coverage for employees on the public project.

From the library