A leading Texas pool builder, Cody Pools, Inc., has reached a settlement with its insurers after a high-profile coverage battle, marking a pivotal moment for homeowners and contractors enduring the wave of ASR poolshell failures in Central Texas.
Cody’s settlement agreement, recorded on October 24, 2025, and posted electronically by the U.S. District Court, arrived nearly a year after the initial complaint was filed by its insurance company, which sought to deny coverage for claims related to ASR, commonly known as “concrete cancer.”
In November 2024, the Continental Insurance Company and National Fire Insurance Company of Hartford filed suit in the U.S. District Court for the Western District of Texas (Austin Division) against Cody Pools, asking the court to declare that they had no obligation to defend or indemnify the builder for certain ASR-related damages.
The case centered on whether damage caused by alkali-silica reaction (ASR) in swimming pool shells falls within the builder’s commercial general liability coverage purchased from the insurers.
Cody Pools answered the lawsuit with a counter-claim, which was dismissed in federal court this July.
During a September 12 mediation session, the parties reached a settlement agreement. The Joint Notice of Settlement indicates that the formal settlement agreement is being finalized and a request for dismissal of the action will follow within approximately 30 days.
In its original complaint, the insurers (Continental/National Fire) sought a declaration that their policies did not cover theASR damage claimed by pool-owners against Cody Pools. Their position was that the presence of silica (reactive silica aggregate) in the concrete caused the damage, and that certain policy exclusions (for instance silica exclusion or “pollutant” type exclusion) barred coverage.
“ASR arises, in whole or in part, out of the presence of silica,” the lawsuit states. “ASR damage to pools is excluded from coverage by the policies’ silica exclusions.
Based on the silica exclusion, CNA has no obligation to defend suits against Cody Pools that allege that the defects in the pool are due to ASR damage. Based on the silica exclusion, CNA also has no obligation to indemnify Cody Pools for settlements where the evidence shows that the damage to the pool was due to ASR.” Cody Pools’ objective was to preserve its insurance coverage and resist being left to absorb the full cost of ASR-related warranty claims and remediation. Cody had publicly taken the position that insurers were withdrawing the coverage that the builder believed it had purchased.
“CNA’s lawsuit against Cody Pools is disappointing,” Cody’s lawyers wrote in a March 2025 statement. “CNA is attempting to abandon its longtime client by claiming that the insurance policies Cody purchased provide no coverage for damage to the most common building material used in the construction industry: concrete.”
While the exact terms of the settlement remain under seal and/ or are not yet publicly detailed, the fact that Cody Pools reached a mediated resolution with its insurers is significant.
Given that the lawsuit's central question was whether Continental had to cover the ASR claims, the settlement probably means that Cody Pools received some level of financial support from its insurer. A settlement probably would not have occurred if Cody Pools received nothing and Continental was fully justified in its 'silica exclusion' defense.
That said, Continental likely paid less than full coverage: The settlement indicates that Continental did not agree to provide full coverage for all ASR claims. It is likely that Continental paid an amount that was discounted from its total potential liability.
Because no details of the settlement agreement have been released, one can only speculate on terms; details may emerge during the resolution of Cody’s customer claims. As Cody Pools settles with individual homeowners, some of those homeowners might publicly disclose the terms of their settlements, though they might also be subject to confidentiality clauses.
The Cody Pools settlement provides an important signal to the entire pool-construction industry. ASR is no longer a niche problem but a commercial and liability risk affecting large builders, insurers and contractors. Insurance companies may tighten coverage terms, exclude ASR or reactive aggregate exposures, or raise premiums for pool builders in ASR-prone regions. Builders may see warranties become costlier or narrower, and may need to adopt stricter material controls, testing protocols and documentation of aggregate/cement/fly-ash mixes.
It should be emphasized that Cody Pools is a major player in the pool building industry, enjoying industry support for its reputation for quality and leadership. Cody Pools and its president and CEO, Mike Church, were named “2025 Builder of the Year” by the Pool and Hot Tub Alliance, awarded by a peer-based vote among more than 4,300 PHTA members.
