Most states require that contractors be licensed and bonded to perform construction work. Each state, including California, has its own rules for licensing and surety bond requirements for contractors to practice their trade legally.
The Contractors State License Board (CSLB) regulates the construction industry in California. To get a contractor’s license in the state, you must apply for the right one. There are four general types of contractor licenses:
• Class A General Engineering Contractor License
• Class B General Building Contractor License
• Class B-2 Residential Remodeling Contractor License
• Class C Specialty Contractor License
There are over 40 classifications to choose from, including general, electrical, plumbing, concrete, solar, roofing, swimming pool, and well drilling contractor.
Qualification Requirements for Contractor’s License
To qualify for the license you want, you must be 18 years old or older and have the experience and skills to manage the daily activities of a construction business, including field supervision. You can choose a representative with the necessary skills and expertise to serve as your qualifying individual. You also must have four years of verifiable experience at the journey level or as a foreman, supervisor, or contractor in the classification for which you’re applying. Visit the CSLB website for more information.
In addition, you must complete a background check and pass the licensing exam.
There’s a mandatory $450 processing fee for contractor applications plus a licensing fee:
• $200 initial license fee for a sole owner
• $350 initial license fee for a non-sole owner
• $150 for each additional classification
Surety Bond Requirements
In addition, the CSLB requires you to secure a $25,000 surety bond. This amount was increased in 2023 from $15,000. Contract surety bonds are made between three parties to guarantee that the principal party — in this case, you as the contractor — fulfills its contractual obligations. The surety provider (typically an insurance company) extends a line of credit to the principal party as part of the contractual agreement. This protects the obligee — for instance, your client — if the contract is breached. If the principal fails to fulfill the contractual agreement by, for example, accruing unexpected expenses, then the obligee is protected. The obligee can file a claim against the contract surety bond to receive financial compensation for damages.
CCIS can provide you with the surety bond required to obtain your contractor’s license in California. We are a licensed construction bond and insurance agency with over 75,000+ licensed contractors, many of whom have been with us for more than 10 years.
Note: Please review the applicable state and federal statutes, rules, and regulations for further information and compliance.