California Contractor License Bonds
Learn more about California Contractor License Bonds
How much does a construction contractor bond cost in California?
Like most surety bonds, your personal credit will determine the cost of your CA contractor’s bond. For those of you with standard credit, both the contractor license bond and the Bond of Qualifying Individual (BQI) start as low as $100. If you have bad credit, you may see your contractor license bond quoted higher. Do not fret. They still start pretty low, at around $150.
Contractor bonds for pool and roofer classifications sometimes receive higher bond quotes. These higher quotes are due to a large number of claims that surety companies receive on these bonds. Depending on your credit, some sureties may require collateral in addition to the bond premium.
Why are contractor bonds important in California?
The Contractors State License Board (CSLB) requires a contractor license bond to activate a license. Both new licenses and renewals require a contractor license bond. You will also need a bond if you hope to reactivate an inactive license.
Many people may not know who benefits from this specific bond. So, let's get into that. First off, a contractor license bond will benefit employees that were not paid wages due to them. It also protects consumers from damages they may incur if a licensed contractor violates any license laws.
There are four main types of contractor bonds in California:
- Contractor License (No Roofer or Pool License) $15,000
- Contractor License (Roofer or Pool License) $15,000
- Bond of Qualifying Individual (BQI) $12,500
For detailed specifics and requirements of each bond, visit the CSLB’s website.
Popular California Contractor License Bonds
Contractor License (No Roofer or Pool License)
A license bond for contractors that are not classified as a roofer or pool contractor.
Contractor License (Roofer or Pool License)
A license bond for contractors who have a Roofer or Pool classification.
Bond of Qualifying Individual (BQI)
There are three instances in which you may need a BQI.
- If a Responsible Managing Employee (RME) holds the contractor’s license, you will need a BQI.
- If a Responsible Managing Officer (RMO) who holds the license, does not own at least 10% of the company, you will need a BQI. Please note that if the RMO does own 10% or more of the company, they are exempt from the BQI requirement. In this case, you must file a Qualifier Statement of Ownership.
- The CSLB may require a BQI when issuing an active license, reactivating a license, or maintaining an actively renewed license*. In this case, you will need a BQI in addition to a contractor’s license bond.
*According to Section 7071.9 of the CA Business and Professions Code.
When a licensed contractor violates a license law, the CSLB may revoke that license. To reinstate or reissue the license, you must obtain a disciplinary bond. The bond amount for these disciplinary bonds will vary. The Registrar will determine the bond amount based on the severity of the violation. It will be no less than $15,000 nor greater than ten times the amount of the contractor’s bond.
How do I get my general contractor's license in California?
There are quite a few steps to becoming a licensed contractor in California. If you are looking to renew your license, make sure you have your license number on hand. Otherwise, review this brief list of steps to become a licensed California contractor.
- Understand the Basics: Before starting the process, learn about who needs a contractor’s license bond and who is exempt. Also, familiarize yourself with the different license classifications and other vital information.
- Apply for the Examination: Fill out an application for the Original Contractor’s License, along with a $330 single classification fee. You’ll also need to fill out a Certification of Work Experience form. You must have at least four years of experience in the classification you are applying for to qualify for the exam.
- Once Your Application is Accepted: At least three weeks before your exam date, you will receive a Notice to Appear for Examination. You will also receive a Fingerprinting Live Scan packet for the board to run a background check. Approved applicants must pass a background check to qualify for an active license.
- Pass the Two-Part Exam: All qualifying individuals must pass the Law and Business examination. Then, qualifying individuals must pass the exam for their specified classification. Unless otherwise exempt under the C-61 Limited specialty classification.
- Submit a Surety Bond, Fees, and Remaining Documents: When you pass your exam, you will receive a list of the remaining documents and fees you must submit before the CSLB will issue your license. Including (but not limited to) the specific surety bond you need, a $200 licensing fee, and a Certificate of Worker’s Compensation Insurance (or exemption if there are no employees), and fingerprinting requirements.