CA Contractor License Bond Amount Increased to $25,000

contractor working

What is the current requirement?

A CA Contractor Bond must be in place before California State Licensing Board can issue an active license, reactivate an inactive license, or renew an active license. (Business and Professions Code Section 7071.6).

The purpose of the bond is

  • Protect bonded contractors' customer as a result of defective construction or other license law violations
  • Protect bonded contractors' employees if the contractors don't pay the wage owed to them

The current requirement of the contractor bond is the following: 

  • The bond must be written by a surety company licensed through the California Department of Insurance.
  • The bond must be in the amount of $15,000.
  • The business name and license number on the bond must correspond exactly with the business name and license number on the CSLB's records.
  • The bond must have the signature of the attorney-in-fact for the surety company.
  • The bond must be written on a form approved by the Attorney General's Office.
  • The bond must be received at the CSLB's Headquarters Office within 90 days of the effective date of the bond.

What is the change? 

The Contractor State Licensing Board (CSLB) first announced this change in December 2021. As a result of Senate Bill 607, the Contractor License Bond has increased from $15,000 to $25,000, effective January 1st 2023. All other requirements remain the same.

What is the implication on my bond?

Given that bond premium is a fraction of the bond amount, an increase of the bond amount means that bond premium will increase. If you have a credit score of 800 or above, your bond amount will increase from $90 to $150.

What do I need to do?

As a principal, if your bond expires after January 1st 2023 and the bond is only $15,000, you will receive an invoice via email or in the mail from your surety company to make a prorated payment on your bond. If you have not received the invoice for a prorated payment by middle January of 2023, then you should contact your surety company directly