Free checklist for contractors
California contractor compliance checklist
What California law asks of a contractor on residential work, from the rules ProntoBill keeps for California: licensing, bond and insurance where the state sets them, and the notices and contract requirements. Each item links the law’s own text, and the page says plainly what it doesn’t cover. No account and no email.
Informational guidance, not a legal determination. This page summarizes the rules as they were checked on the dates shown. Each section has conditions a summary can’t hold, so read the law it links. Check with a construction lawyer how the rules apply to your contracts.
Your contractor license
California contractors are licensed by the Contractors State License Board (CSLB).
Checked against the law’s own text, not reviewed by a lawyer.
This section doesn’t list every document your number must appear on; the contract requirements below name some.
Bond and liability insurance minimums
The minimums by type of license. They are the floor the law sets: the state may require more of you.
- Licensed contractor (sole owner, partnership or corporation): bond $25,000 (or a cash deposit); no insurance minimum in the sources read (Cal. Bus. & Prof. Code § 7071.6(a), checked November 5, 2026). Checked against the law’s own text, not reviewed by a lawyer.
- Licensed contractor (LLC): bond $25,000 (or a cash deposit); insurance (liability, aggregate: $1,000,000) (Cal. Bus. & Prof. Code §§ 7071.6(a), 7071.6.5, 7071.19, checked November 5, 2026). Checked against the law’s own text, not reviewed by a lawyer.
- California doesn’t require general liability insurance for a sole owner, partnership or corporation, but your contracts must say whether you carry it (CCR 872).
- A responsible managing employee, or a managing officer owning less than 10% of the voting stock, needs a separate $25,000 qualifying individual bond (B&P 7071.9).
- Workers’ compensation is required if you have employees (B&P 7125). Roofing (C-39), and a few other classes including C-8, C-20, C-22 and tree service (D-49), need it whether or not you have employees. From January 1, 2028 the no-employee exemption ends for almost everyone.
- An LLC also needs a $100,000 bond for unpaid wages and benefits, on top of the $25,000 contractor bond (B&P 7071.6.5).
- With more than five people on the personnel of record, the aggregate rises by $100,000 for each person listed, up to $5,000,000 (B&P 7071.19).
Notices and contract requirements
What the law asks you to give the customer, or put in the contract, on a job. A summary of each, from the rule’s data: the section itself can narrow when it applies.
Home improvement contract requirements (B&P 7159)
- Price
- Over $500
- When
- Before work starts
- Can cover
- Homes and buildings of 1–4 units and residential buildings of 5 or more units
- Not covered
- Commercial work
- Signed by
- You and the customer
- Not owed when your customer is another contractor.
- If the price grows past the threshold after work starts, it is due at once and the deadline has already passed.
Checked against the law’s own text, not reviewed by a lawyer. Checked November 5, 2026.
Commercial general liability insurance statement (CCR 872)
- Price
- At any price
- When
- Before the contract is signed
- Can cover
- Homes and buildings of 1–4 units and residential buildings of 5 or more units
- Not covered
- Commercial work
- Not owed when your customer is another contractor.
Checked against the law’s own text, not reviewed by a lawyer. Checked November 5, 2026.
Home improvement contracts in writing; down payment and progress payment limits (B&P 7159.5)
- Price
- At any price
- When
- Before work starts. The law names no deadline; this is the cautious course.
- Can cover
- Homes and buildings of 1–4 units and residential buildings of 5 or more units
- Not covered
- Commercial work
- Not owed when your customer is another contractor.
Checked against the law’s own text, not reviewed by a lawyer. Checked November 5, 2026.
Federal Cooling-Off Rule notice of cancellation (16 CFR 429)
- Price
- $25 or more
- When
- Before the contract is signed
- Can cover
- Homes and buildings of 1–4 units and residential buildings of 5 or more units
- Not covered
- Commercial work
- Not owed when your customer is another contractor.
- Only when the sale was made at the customer’s home, or anywhere away from your place of business. The $25 is for a sale at the home; elsewhere away from your business, the rule covers sales of $130 or more (16 CFR 429.0(a)).
Checked against the law’s own text, not reviewed by a lawyer. Checked November 5, 2026.
More on each notice: the contractor notices guide
Questions
- Is this legal advice?
- No. It’s informational guidance, not a legal determination: the state’s law as it was read on the dates shown. Check with a construction lawyer how it applies to your contracts.
- Do I need an account?
- No. Nothing here needs an account or an email, and the page sends nothing anywhere. Print it or take a screenshot to keep it.
- What isn’t covered?
- Anything the page doesn’t list: local licenses and permits, lead paint in pre-1978 homes, employees and workers’ compensation beyond the notes above, and sales tax (see the sales-tax guide).
Sales tax by state: the contractor sales-tax guide
