What is a California Qualifying Individual (BQI) Bond?
As defined by the California Contractors State License Board (CSLB), a qualifying individual, or qualifier, “is the person listed on the CSLB records who meets the experience and examination requirements for the [CA contractor] license.” The qualifier is the individual responsible for the construction operations of their employer. The CSLB requires the California Qualifying Individual Bond, also called the Bond of Qualifying Individual (BQI), in two specific circumstances, discussed below.
The CA Bond of Qualifying Individual has two purposes. First, it protects the public from financial harm if the qualifying individual of a contractor license does not uphold the relevant regulations of California Contractors’ License Law. This bond also protects employees who have not been paid wages due to them by the violating contractor.
**Effective January 1st, 2023, the CA Contractor License Bond, Bond of Qualifying Individual, and Contractors Disciplinary Bond will increase to a $25,000 bond amount as a result of Senate Bill 607. This page has been updated to reflect that.**
How does the CA Bond of Qualifying Individual work?
Suppose the qualifying individual fails to adhere to state laws and licensing regulations, resulting in injury to the public or an employee (in the form of unpaid wages). In that case, the injured party can file a claim against the bond. If the surety company finds the claim valid after a thorough investigation, they will compensate the injured party up to the bond amount. The licensee and associated qualifying individual are ultimately responsible for reimbursing the surety for any claims paid out, plus additional fees and expenses incurred by the surety company.
Who has to get this bond?
As stated in the California Business and Professions Code Section 7071.9, you must have a BQI if the California contractor license is qualified by a Responsible Managing Employee (RME) or a Responsible Managing Officer (RMO) who owns less than 10% of the voting shares of the company. Generally speaking, RMEs and RMOs are individuals who have proven their expertise to the Contractors State License Board to qualify for those positions.
More specifically, California Contractors License Law (Chapter 13, Article 2, § 823(a)) defines an RME as a bona fide employee of the applicant of the license that actively engages in the contracting business of the applicant “for at least 32 hours or 80% of the total hours per week such business is in operation, whichever is less.” An RMO is the individual that exercises direct supervision and control of their employer’s construction operations in compliance with California law and the CSLB regulations.
How much does this bond cost?
The California Qualifying Individual Bond has a required bond amount of $25,000. However, this is not the amount you pay for your bond. Instead, you’ll pay a fraction of that bond amount. The surety company will analyze several factors, such as your experience in the industry, business and personal financials, and your credit, and assign you a premium rate starting anywhere from 0.8% to 4% (and higher) of the bond amount.
Obligee information
In surety bonding, the obligee is the entity that requires you to get a bond. In this case, the obligee for the CA Bond of Qualifying Individual is the Contractors State License Board. Their contact is listed below.
State of California
Contractors State License Board
9821 Business Park Dr.
Sacramento, CA 95827
Phone: (800) 321-CSLB (2752)
Phone (outside California): (916) 255-3900
How to get your State Of California Qualifying Individual (BQI) Bond
Regardless of the type of surety bond you need, the application process with EZ Surety Bonds is quick and simple. You can obtain your California BQI by completing the short application on our website and one of our surety experts will contact you regarding your free quote within 24 hours.
We understand how confusing surety bonds can be. If you ever have any questions, you can contact our surety experts at info@ezsuretybonds.com or call 1-866-546-4605.
Frequently asked questions
How do I become a licensed contractor in California?
To become a licensed contractor in the state of California, you must:
1. Meet the experience and examination requirements for the license to qualify.
2. Determine your license classification: Class A – General Engineering Contractor, Class B – General Building Contractor, or Class C- Specialty Contractor.
3. Submit an Application for an Original Contractor License (Form 13A-1) and pay the appropriate fees.
4. Pass a knowledge exam.
5. Obtain your required surety bond(s), such as:
– The $25,000 Contractor’s License Bond
– The $100,000 LLC Employee/Wage Bond (for businesses operating as a Limited Liability Company)
– The $25,000 California Bond of Qualifying Individual, if applicable
6. File your bond(s) with the CSLB within 90 days of the effective date of the bond(s).
You can find a more in-depth guide to getting a California contractor’s license here.
How much is a Qualifying Individual (BQI) Bond in California?
The State of California Qualifying Individual Bond has a required bond amount of $25,000, but you will only pay a percentage of that. This CA BQI requires a soft credit check, and applicants with excellent credit may see quotes starting as low as .8% to 1% of the bond amount.
However, you don’t necessarily need exceptional credit to get bonded. We encourage you to apply for your bond even if you have nonstandard or poor credit. At EZ Surety Bonds, we work with a variety of surety companies to find you the best quote available.
What do I do after purchasing my California Qualifying Individual Bond?
After you purchase your California BQI with EZ Surety Bonds, we will mail the original document to you. Most obligees require you, the principal, to file the original bond with them within a specific time frame. As of 2022, the California CSLB requires you to file your bond with their headquarters within 90 days of the effective date on the bond.
