California Contractor License: Bonds and Insurance
You Passed the Exam. Now CSLB Wants Paper.
After you pass, CSLB's Issuance Unit sends a bond and fee letter listing what you have to submit before your license is actually issued. Nothing happens until that list is satisfied, so the time to line it up is before the letter arrives, not after.
Depending on your structure and classification, the list includes:
| Requirement | Amount |
|---|---|
| Contractor bond | $25,000 |
| Bond of Qualifying Individual, if applicable | $25,000 |
| Certificate of workers' compensation, or a filed exemption | Statutory |
| LLC Employee/Worker Bond, if an LLC | $100,000 |
| LLC liability insurance, if an LLC | $1,000,000 for five or fewer personnel of record, plus $100,000 for each additional person, capped at $5,000,000 |
The initial fee covers two years. The license expires two years from the last day of the month it was issued.
Source: CSLB, Issuing My License
The Workers' Comp Exemption, and Who Can't Use It
Contractors with no employees can file a workers' compensation exemption with the Registrar instead of a certificate. Five classifications cannot:
- C-8 Concrete
- C-20 Warm-Air Heating, Ventilating and Air-Conditioning
- C-22 Asbestos Abatement
- C-39 Roofing
- C-61/D-49 Tree Service
If you hold one of those, you need a real policy to get licensed, employees or not. One more catch that surprises people: if your license is qualified by a Responsible Managing Employee, you can't submit an exemption at all.
And the exemption isn't permanent. The day you hire your first employee, you need coverage, and CSLB needs the certificate.
If You're Forming an LLC, the Requirements Stack
An LLC contractor license carries two obligations a sole owner doesn't:
The $100,000 Employee/Worker Bond, on top of the $25,000 contractor bond. Required at issuance, reissuance, reinstatement, reactivation, and every renewal.
Liability insurance of at least $1 million cumulative for five or fewer persons on the personnel of record, plus $100,000 for each additional person, capped at $5 million. There's also a disclosure piece: specific liability insurance information has to appear on the LLC's home improvement and service and repair contracts.
Where the Bond and the Insurance Come From
CSLB doesn't issue bonds. You get them from an insurance agent or a surety company licensed by the California Department of Insurance. In practice the bond, the workers' comp policy, and the LLC liability policy come from the same place, which is the only reason this page exists — doing it in one pass is faster than three separate hunts while your file sits in Issuance.
What to Have Ready
- Your business structure, and the personnel of record if you're an LLC
- Your classification, and whether it's one of the five that can't exempt
- Payroll estimate, even a rough one, if you'll have employees
- The entity name exactly as registered with the Secretary of State
- Your bond and fee letter, once it arrives
Questions People Ask
What does CSLB require before it issues a contractor license?
After you pass, CSLB's Issuance Unit sends a bond and fee letter listing what you have to submit before your license is actually issued. Depending on your structure and classification, the list includes: the initial licensing fee, a $25,000 contractor bond, a $25,000 Bond of Qualifying Individual if applicable, a certificate of workers' compensation or a filed exemption, and, if an LLC, a $100,000 Employee/Worker Bond and $1,000,000 minimum in liability insurance.
How much is the CSLB contractor bond?
Contractor bond: $25,000. Bond of Qualifying Individual, if applicable: $25,000. LLC Employee/Worker Bond, if an LLC: $100,000.
Which classifications can't file a workers' comp exemption with CSLB?
Contractors with no employees can file a workers' compensation exemption with the Registrar instead of a certificate. Five classifications cannot: C-8 Concrete, C-20 Warm-Air Heating, Ventilating and Air-Conditioning, C-22 Asbestos Abatement, C-39 Roofing, and C-61/D-49 Tree Service. If your license is qualified by a Responsible Managing Employee, you can't submit an exemption at all.
What insurance does an LLC contractor need in California?
An LLC contractor license carries two obligations a sole owner doesn't: the $100,000 Employee/Worker Bond, on top of the $25,000 contractor bond, and liability insurance of at least $1 million cumulative for five or fewer persons on the personnel of record, plus $100,000 for each additional person, capped at $5 million.
Where do I get a contractor bond in California?
CSLB doesn't issue bonds. You get them from an insurance agent or a surety company licensed by the California Department of Insurance.