Effective January 1, 2016, California contractors will need to post a $15,000 surety bond. Previously the required bond amount was $12,500. Senate Bill 467, signed by Gov. Jerry Brown on October 8, also eliminates the financial solvency requirement for new or renewing contractor license applicants. Prior to the bill’s passing, applicants were obligated to provide proof of financial solvency in the amount of $2,500, meaning that their operating capital had to exceed that amount. The increased bond amount replaces that requirement.
The contractors license bond protects contractors’ clients in the event that a contractor violates the laws governing the industry, resulting in financial harm to the client. The California Contractors License Law & Reference Book contains detailed information about those rules and regulations.
The Contractors State License Board’s (CSLB) website contains extensive information for California contractors, including application information and the necessary forms. Contact CSLB or SuretyBonds.com to learn more about the bond increase.