California contractor's license bond ($25,000): what it covers for a GC
- Every active California contractor license needs a $25,000 contractor's bond (since January 1, 2023). An inactive license doesn't need one.
- The bond mainly protects homeowners and property owners, people hurt by willful violations or fraud, and the contractor's own employees for unpaid wages and benefits.
- Claims other than homeowners' are capped at $7,500 in total, so a GC shouldn't count on it for much.
- A bond isn't insurance. It doesn't replace general liability, workers' comp, or a payment or performance bond on your job.
What the law requires
California requires a contractor's bond of $25,000 as a condition of an active license, operative January 1, 2023 (B&P Code §7071.6). No bond is required while a license is inactive. CSLB can require a $50,000 bond from some applicants with past unlicensed-contracting violations.
LLC licensees carry more: a separate $100,000 bond for the benefit of employees' unpaid wages and fringe benefits (B&P Code §7071.6.5), plus liability insurance with an aggregate limit of at least $1 million, more when more than five people are listed on the license (B&P Code §7071.19).
Who can claim on it
Under B&P Code §7071.5, the bond is for the benefit of:
- A homeowner hiring for home improvement on their own residence, damaged by the licensee's violation of the contractors' law.
- A property owner building a single-family home that isn't intended for sale.
- Anyone damaged by the licensee's willful and deliberate violation, or by fraud in a construction contract.
- The licensee's employees, for unpaid wages, and funds owed fringe benefits on their behalf.
For everyone except the homeowners in the first item, the surety's total liability is capped at $7,500; the rest is reserved for those homeowners (§7071.6(b)). A GC with a dispute over a sub's workmanship or a missed schedule usually isn't the bond's main beneficiary.
What it isn't
- Not liability insurance. If a sub damages property or injures someone, you want their general liability policy, with you as an additional insured.
- Not workers' comp. See workers' comp and subs.
- Not a performance or payment bond. If you need a surety to stand behind a sub's work or its payments to suppliers, that's a separate project bond your subcontract has to require.
What to check on the CSLB record
- A contractor's bond is on fileThe record lists the surety, bond number, amount and effective date. Sub Check shows it too.
- The amount is $25,000Or more for some licensees. If the record shows no current bond, ask before the sub starts.
- LLC? Look for the worker bondLLC records should also show the $100,000 employee bond.
- Then get the paperwork the bond doesn't coverA certificate of insurance for GL and workers' comp, and any project bonds your contract calls for.
General information for California contractors, current as of November 3, 2026. It isn't legal advice; rules change, so check the official source linked above.
More guides
- How to check a California contractor license (CSLB): a GC's checklist
- Workers' comp and subcontractors in California: what GCs should check
- Certificate of insurance checklist for California general contractors
- Additional insured and waiver of subrogation for subcontractors: a California GC's guide
- Risks of hiring an unlicensed subcontractor in California (for GCs)
- Workers' comp premium audits and subcontractors in California: how to prepare
- Matching a sub's California license classification to the work