Texas Fire Alarm, Sprinkler and Extinguisher Firms: What the State Fire Marshal Requires

What the Insurance Has to Be

General liability of at least $100,000 combined single limit per occurrence and $300,000 aggregate per policy year, including products and completed operations coverage. The policy has to cover bodily injury and property damage caused by "the insured or the insured's officer, agent, or employee" in the regulated work. SFMO also requires an occurrence policy: the OCCUR box on the certificate must be checked. A burglar alarm company licensed under Occupations Code chapter 1702 meets the alarm-firm insurance requirement through that chapter if its policy meets these amounts and types of coverage.

Sources: Tex. Ins. Code § 6001.154 · Tex. Ins. Code § 6002.153 · Tex. Ins. Code § 6003.152 · TDI, Certificate of liability insurance requirements

The Agent Is a Required Party

The certificate has to carry the signature of an individual Texas-licensed agent; a stamp or an insurer's signature alone doesn't satisfy it. Surplus lines coverage can be filed instead, but only through a surplus lines agent licensed under Chapter 981 and resident in Texas. TDI's instructions are blunter: the certificate "must be signed by an individual who is a licensed general lines or surplus lines agent in Texas. A company stamp will not be accepted." The agent's printed name and license number go on it too.

Sources: Tex. Ins. Code § 6002.153 · TDI, Certificate of liability insurance requirements

What the Certificate Must Show

SFMO lists what the certificate must show, and it won't approve a new application or renewal until the insurance requirements are met. The certificate needs:

• The full company name, including Inc., Corp., or Co., plus any assumed names and DBAs, matching the name on the application.
• The types of business covered, such as fire alarm or fixed extinguisher systems, in the description of operations.
• The insurer's name as listed with TDI, with its NAIC number.
• The General Liability box and the OCCUR box checked.
• A policy number. "TBD" isn't acceptable.
• An effective date no later than the expiration date of the last certificate on file, so there's no gap, and an expiration date.
• Limits of at least $100,000 per occurrence and $300,000 for the policy year, with products and completed operations.
• The State Fire Marshal's Office as certificate holder.
• The agent's name, signature, and license number.

The extinguisher rule spells out how the insured's name reads: a corporation's name, "dba" the assumed name if there is one; a partnership's name or every partner's; a proprietor's own name, "dba" any assumed name. Certificates go to FMLicensing@tdi.texas.gov.

Sources: TDI, Certificate of liability insurance requirements · 28 Tex. Admin. Code § 34.514

A Physical Address, Not a P.O. Box

All three registrations require a physical business location. The extinguisher, alarm, and sprinkler rules each say the business location "must be a physical address, not a mailing address or P.O. Box," and the location is shown on the certificate of registration.

Sources: 28 Tex. Admin. Code § 34.510 · 28 Tex. Admin. Code § 34.610 · 28 Tex. Admin. Code § 34.710

The Renewal Cycle

A renewed registration is valid for two years under all three chapters, and SFMO mails notice at least 30 days before it expires. A registration that has been expired 90 days or less can still be renewed with a late fee; one expired more than 90 days but less than two years can be renewed by paying all unpaid renewal fees plus a further fee; after two years the firm starts over as a new applicant. Insurance comes up at every renewal: SFMO won't approve one until the insurance requirements are met.

Sources: Tex. Ins. Code § 6001.201–.203 · Tex. Ins. Code § 6002.201–.203 · Tex. Ins. Code § 6003.201–.203 · TDI, Certificate of liability insurance requirements

What a Lapse Does

A lapse takes the firm off SFMO's public search and puts the registration at risk. Failing to maintain the insurance "constitutes grounds for the denial, suspension, or revocation, after notice and opportunity for hearing," of the registration, in each of the three chapters. TDI says registered companies with an expired insurance certificate "are in violation and will no longer be listed on our search page," and the search itself won't return a company whose insurance is expired or not on file.

Sources: Tex. Ins. Code § 6001.154 · Tex. Ins. Code § 6002.153 · Tex. Ins. Code § 6003.152 · TDI, Certificate of liability insurance requirements · SFMO company/licensee search