CSLB Insurance Requirements: What California Contractors Must Carry
The CSLB requires a $25,000 license bond and workers comp for licensees with employees. Here is what each one costs, what triggers license suspension, and what GCs require beyond it.
The CSLB requires two things to keep a California contractor license active: a $25,000 contractor license bond, and workers’ compensation coverage if you have employees. C-39 roofing contractors must carry workers’ compensation even with zero employees. General liability is not a CSLB requirement, but nearly every general contractor and permit office demands it before you can work.
The $25,000 License Bond
You do not pay $25,000. You pay a premium, typically 1 to 5 percent of the bond amount, which is roughly $250 to $1,250 per year. Credit is the main pricing factor. The bond protects consumers and the state, not you: if a valid claim is paid, the surety collects that amount back from you.
Workers’ Compensation and the Roofing Exception
Workers’ compensation is required the moment you hire your first employee. The exception that catches contractors every year is the C-39 roofing classification, which requires coverage even for a sole proprietor with no crew. There is no exemption. The CSLB ties license status to workers’ compensation compliance, so a lapse can suspend the license automatically.
What Suspends a California Contractor License
- A cancelled or lapsed contractor license bond
- A workers’ compensation policy that lapses while you have employees on payroll
- Failure to maintain a required qualifying individual or disciplinary bond
What the CSLB Does Not Require but Your Clients Will
General liability is not part of CSLB licensing, yet it is the certificate you will be asked for most. $1M per occurrence and $2M aggregate is the standard request, often with additional insured status for the hiring party. Budget $600 to $1,800 per year for most small contractors.
Renewal Traps
The most common preventable suspension comes from letting the bond expire while waiting on a renewal notice. Bond cancellation and license suspension can move faster than contractors expect. Renew ahead of the expiration date, and keep certificates from every subcontractor on file so uninsured subs are not added to your payroll at workers’ compensation audit.
Sources
- Contractors State License Board — cslb.ca.gov
- CSLB License Lookup — cslb.ca.gov
- California Division of Workers’ Compensation — dir.ca.gov/dwc