California contractors have more insurance rules than most.
The CSLB sets liability minimums for LLCs, workers’ comp is expanding to every license, and home improvement contracts carry a disclosure.
Quick answer: California requires LLC contractors to carry liability insurance set by personnel count, and some trades must carry workers’ comp even with no employees. Under SB 1455, that requirement extends to all contractor licensees on January 1, 2028.
Three California rules that shape contractor coverage
LLC liability minimums
Under B&P 7071.19, an LLC licensee carries at least $1M of liability coverage for five or fewer personnel, plus $100k for each additional person, up to $5M.
Workers' comp is expanding
Roofing, concrete, HVAC, tree service and asbestos abatement licensees already need it. SB 1455 moved the date for all other licensees to January 1, 2028.
Disclosure on home improvement work
CSLB rules require a commercial general liability disclosure on home improvement bids and contracts, naming the insurer and its phone number when you have coverage.
Where California contractor coverage can run short
| Job-site risk | Under a typical CGL? | Where contractors look |
|---|---|---|
| Your own faulty work | No | Not insurable; warranty and quality control |
| Tools on job sites | Often not | Inland marine or equipment floater |
| Pollution from your work | Excluded | Contractors pollution liability |
| Residential construction | Sometimes restricted | Confirm the policy allows your work type |
| Latent defects years later | Completed operations | Keep limits in place; CA allows claims up to 10 years |
Find your city
Cities add their own permit and contract insurance requirements. Pick yours.
San Diego County
Bidding jobs in another part of the state? Call and talk to one of our agents.
What California contractors ask us.
Does the CSLB require general liability insurance?
For LLC licensees, yes: B&P 7071.19 sets $1M for five or fewer personnel, plus $100k per additional person, with a $5M cap. Other licensees are not required to carry it by the CSLB, but must disclose their coverage status on home improvement contracts.
When do all California contractors need workers' comp?
SB 1455 set January 1, 2028 for all licensees. Roofing (C-39), concrete (C-8), HVAC (C-20), tree service (D-49) and asbestos abatement licensees already need it, even without employees.
How long can someone bring a construction defect claim in California?
Code of Civil Procedure 337.15 allows claims for latent defects up to 10 years after substantial completion. Injury claims generally have two years under CCP 335.1.
Do I need a bond and insurance?
They do different things. The CSLB requires a contractor bond for licensing, while insurance protects your business from covered claims. Many contractors carry both.
Will one policy cover residential and commercial work?
Not always. Some policies restrict residential or tract work, so it helps to confirm the policy matches the jobs you actually take.
NPN #20649362 · Rock Meadow Insurance Services · Last updated November 2026
Compare contractor coverage that matches your license.
Share your license class, crew size and a sample contract, and we will match coverage to it.