Figures on this page were verified against each state’s licensing board on 6 September 2026, Arizona against the Arizona Revised Statutes on 7 September 2026, and Ohio against the Ohio Construction Industry Licensing Board and the City of Columbus on 19 October 2026, and Alabama against the Home Builders Licensure Board rules on 20 October 2026. Sources are listed at the foot of the page. Bond and insurance coverage content reviewed by Tyler Williamson, Licensed Property & Casualty Insurance Agent, North Carolina.
A contractor license bond is not a national requirement. Of the eleven states verified below, five require one to be licensed and six do not. California sets a flat $25,000 and Washington $30,000 for a general contractor. Texas and Ohio have no state general contractor licence at all, Florida attaches its $100,000 bond to a named officer rather than to the business, and Alabama bonds only residential roofers.
Almost every page you will find on this subject is published by a company that sells surety bonds. Those pages are not wrong, but they are written from the position that you need one. Whether you actually do depends entirely on the state you are licensed in, and in six of the eleven states verified below, the answer is no.
Comparing states? See how to become a general contractor, our side-by-side of the requirements in every state we cover.
Which states require a contractor license bond
The figures below come from each state’s licensing board or its governing statute, not from bond sellers.
| State | Required to be licensed? | Amount |
|---|---|---|
| California | Yes | $25,000 |
| Washington | Yes | $30,000 general $15,000 specialty |
| Oregon | Yes | $15,000 – $80,000 by endorsement |
| Nevada | Yes | $1,000 – $500,000 set by the Board |
| Arizona | Yes | $1,000 – $100,000 scaled to your annual volume |
| North Carolina | No | Bond offered only as an alternative to the working capital requirement |
| Louisiana | No | Accepted only where net worth is negative |
| Texas | No | No state general contractor licence exists |
| Florida | No | $100,000 bond required of the Financially Responsible Officer, not the business |
| Ohio | No | No state general contractor licence; cities set their own (Columbus: $25,000) |
We add states to this table as we verify them. If yours is missing, it is because we have not checked it yet rather than because it has no requirement.
What a contractor license bond actually is
A licence bond is a three-party agreement. You are the principal. The surety is the company that issues the bond. The obligee is the state — the party the bond is written for.
The bond guarantees that you will follow the state’s licensing law. If you do not, and someone is harmed, they can claim against the bond and the surety pays them up to the bond’s face value.
Then the surety comes to you for the money.
This is the single most important thing to understand about a bond and it is the part most commonly glossed over: a surety bond is not insurance and it does not protect you. It protects the public from you. A paid claim is a debt you owe the surety, and they will pursue it. The bond exists so the state can licence you without exposing consumers to your mistakes.
Bond, insurance, and why the difference matters
| Surety bond | Liability insurance | |
|---|---|---|
| Protects | Your client and the state | You |
| Parties | Three — you, surety, state | Two — you and the insurer |
| On a claim | Surety pays, then recovers from you | Insurer pays and absorbs the loss |
| You pay | A premium, plus the full claim if one is paid | A premium and your deductible |
Contractors regularly assume that being bonded means being covered. It does not. A general contractor who asks whether you are “licensed, bonded and insured” is asking three separate questions, and holding a bond answers only one of them.
The states differ here too. Nevada requires proof of workers’ compensation before it will licence you at all. North Carolina’s board states plainly that there is no insurance requirement for a general contractor’s licence. Oregon sets a liability minimum for every endorsement, ranging from $100,000 per occurrence on a residential limited licence to $2 million on a commercial general Level 1.
How the amount is set
Three different models are in use, and they change what you can plan for.
A flat statutory figure. California is the clean example: $25,000, the same for everyone, set by Senate Bill 607 and effective from 1 January 2023. You know the number before you apply.
A figure that follows your licence class. Washington sets $30,000 for general contractors and $15,000 for specialty contractors. Oregon runs the same idea further, setting a bond for each endorsement: $15,000 for a residential limited contractor, $25,000 for a residential general, $55,000 for a commercial specialty Level 1, and $80,000 for a commercial general Level 1.
A figure the board decides. Nevada sets your bond somewhere between $1,000 and $500,000 at the point of licence approval, weighing your licence type, requested monetary limit, financial responsibility, experience and character. Two applicants asking for the same monetary limit can be given very different bonds, and you will not know yours until the Board tells you.
A figure that scales with your turnover. Arizona is the fourth model and the most granular. The Registrar fixes your bond within ranges set by statute, after giving due consideration to the volume of work and the classification you are applying for. A general commercial contractor expecting under $150,000 of work posts a flat $5,000; one expecting $10,000,000 or more posts between $50,000 and $100,000.
| Estimated annual volume | General commercial | Specialty commercial |
|---|---|---|
| Under $150,000 | $5,000 | $2,500 |
| $150,000 – $500,000 | $5,000 – $15,000 | $2,500 – $7,500 |
| $500,000 – $1m | $10,000 – $25,000 | $5,000 – $17,500 |
| $1m – $5m | $15,000 – $50,000 | $7,500 – $25,000 |
| $5m – $10m | $35,000 – $75,000 | $17,500 – $37,500 |
| $10m or more | $50,000 – $100,000 | $37,500 – $50,000 |
Residential is set separately: $5,000 to $15,000 for a general residential contractor and $1,000 to $7,500 for a specialty residential contractor.
Two Arizona-specific points matter more than the table. These are the statutory ranges, not the price you will be quoted — the Registrar picks a figure inside them, and the ROC publishes its own schedule which we have not been able to verify directly. And residential and dual-licensed contractors carry a second obligation on top of the bond: either an additional $200,000 bond or cash deposit for actual damages, or membership of the residential contractors’ recovery fund with its assessment. Arizona also accepts a cash deposit with the state treasurer in place of a bond, withdrawable two years after the licence ends if no claims are outstanding.
Two structural details that catch people out
Oregon can require two bonds. A contractor holding both a residential and a commercial endorsement must carry two separate bonds, one for each, and a single liability policy written at the higher of the two amounts.
California can require a second bond for the qualifier. Where a licence is qualified by a Responsible Managing Employee, or by a Responsible Managing Officer who owns less than 10% of the voting stock, a separate $25,000 Bond of Qualifying Individual is required on top of the contractor’s bond.
What a bond costs
You do not pay the face value. You pay an annual premium to the surety, and the bond is written for the full amount.
The premium is priced on your credit history, your financial statements, how long you have been trading and your claims record. No state board publishes or sets this price — it is quoted by the surety, and a contractor with strong credit and one with a thin file can be quoted very differently for an identical bond. Any figure you see presented as “the” cost of a bond is a marketing estimate, not a published rate.
Get quotes from more than one surety before you buy. The bond is a commodity; the price is not.
Alternatives to posting a bond
Four of the eleven states verified here break the simple picture, in two opposite directions. Two accept something in place of the bond. Two treat the bond itself as the alternative to something else — which changes entirely what it is for.
Washington allows an assigned bank account instead — cash, a certificate of deposit, a time deposit or a money market account held at an institution with a Washington branch, in the same amount as the bond.
Arizona accepts a cash deposit lodged with the state treasurer in the amount of the bond. It can be withdrawn two years after the licence ends if no claims are outstanding against it, or two years after a commercial surety bond is filed to replace it.
North Carolina is the case that undercuts the common assumption entirely. The Licensing Board for General Contractors accepts three ways of evidencing financial responsibility: audited financial statements, an Agreed-Upon Procedures report prepared to AICPA standards, or a surety bond of $175,000, $500,000 or $1,000,000 depending on the licence limit you want. Here the bond is not a licensing requirement at all — it is one route through a working capital test, and often the most expensive of the three.
Louisiana takes a similar line. A bond, letter of credit or other security is accepted only where an applicant’s net worth is negative, set at the requirement plus the shortfall. It is not a standard condition of licensure.
Where the bond is not the contractor’s to post
Three of the eleven states change the question rather than answering it, and all three are large markets.
Texas has no statewide general contractor licence. There is no state licence to bond. Individual trades are licensed at state level — air conditioning and refrigeration contractors through the Texas Department of Licensing and Regulation, for instance — and those licences carry an insurance requirement instead of a bond. TDLR requires a Class A air conditioning contractor to maintain commercial general liability cover of $300,000 per occurrence for property damage and bodily injury, $600,000 aggregate, and $300,000 for products and completed operations. A Class B licence requires $100,000, $200,000 and $100,000. Cover must be held from an insurer authorised in Texas for the whole time the licence is active. Local jurisdictions may still require registration or bonding of their own.
Ohio works the same way, but leans harder on cities. The state licenses only five commercial trades — electrical, HVAC, plumbing, hydronics and refrigeration — and sets no bond for them. General and residential contractors are licensed by their city or county, and some of those set bonds of their own. Columbus, for example, requires a $25,000 bond for its general contractor licence. That figure appears in several guides as an Ohio requirement; it is one city’s. Full detail is in our Ohio guide.
Florida bonds the officer, not the company. A contractor is not required to post a bond to be licensed. What Florida requires is a credit report showing a FICO score of 660 or higher — there is no minimum net worth test — and an applicant scoring below 660 must complete a board-approved 14-hour financial responsibility and stability course. Where a business designates a Financially Responsible Officer, that individual must hold a $100,000 bond payable to the Construction Industry Licensing Board. An irrevocable letter of credit in the same amount is accepted; a letter of bondability is not. Someone acting as FRO for several businesses needs a separate bond for each.
Both are worth understanding before you buy anything. In Texas the money goes to an insurance policy rather than a bond. In Florida a bond may be required of a person in your business without being required of the business itself.
How to get one
- Confirm your state actually requires it, and in what amount, using the table above or your board’s own page. Do not take a bond seller’s word for whether you need a bond.
- Confirm the amount for your licence class or endorsement, not the state’s headline figure. Oregon and Washington both vary it, and Oregon may require two.
- Get quotes from several sureties. Expect to provide financial information and to have your credit checked.
- Check the form. Most boards require their own bond form, executed correctly, and will reject a substitute.
- File it inside the window. California requires the bond to reach the Registrar within 90 days of the bond’s effective date.
- Diary the renewal. The bond has to stay continuously in force. In California it must be in place before CSLB will issue, reactivate or renew an active licence — a lapse can suspend you.
Frequently asked questions
Does a contractor license bond protect me?
No. It protects your clients and the state. If a claim is paid, the surety recovers the money from you. Liability insurance is what protects you.
How much does a contractor license bond cost?
You pay an annual premium rather than the face amount, priced on your credit, financials, trading history and claims record. No licensing board publishes or regulates this price, so quotes vary between sureties for the same bond.
Do all states require a contractor license bond?
No. Of the eleven states verified on this page, five require one to be licensed — California, Washington, Oregon, Nevada and Arizona — and six do not. Ohio, like Texas, has no state general contractor licence; its cities set their own bond requirements. North Carolina and Louisiana accept a bond only as an alternative route through a financial requirement. Texas has no state general contractor licence to bond and requires liability insurance on its trade licences instead. Florida requires a $100,000 bond of a Financially Responsible Officer rather than of the contractor. Alabama requires a $10,000 bond only for its residential roofers licence; home builders and general contractors are not bonded.
What is the $25,000 contractors bond?
That is California’s contractor’s bond, set at $25,000 by Senate Bill 607 and effective from 1 January 2023. It must be in place before CSLB will issue, reactivate or renew an active licence.
Is a bond the same as being insured?
No, and the difference is financial rather than technical. A bond pays your client and then bills you. Insurance pays on your behalf and absorbs the loss. “Licensed, bonded and insured” describes three separate things.
What happens if someone claims against my bond?
The surety investigates. If the claim is valid it pays the claimant up to the bond amount, then seeks full reimbursement from you. A paid claim also makes your next bond harder and more expensive to obtain.
Sources
- Contractors State License Board (California) — bond requirements
- Washington State Department of Labor & Industries — contractor registration
- Oregon Construction Contractors Board — endorsement chart, dated November 2024
- Nevada State Contractors Board — bonds
- North Carolina Licensing Board for General Contractors — contractor FAQ
- Louisiana State Licensing Board for Contractors, and R.S. 37:2150–2192
- Texas Department of Licensing and Regulation — air conditioning and refrigeration contractor licensing
- Florida Department of Business and Professional Regulation, Construction Industry Licensing Board — construction industry FAQs
- Arizona Revised Statutes section 32-1152 — bonds
- Ohio Construction Industry Licensing Board, and the City of Columbus Department of Building and Zoning Services — contractor licenses
- Alabama Administrative Code r. 465-X-3-.04(5) — Home Builders Licensure Board roofers licence bond
Verified against the boards named above on 6 September 2026. Bond amounts and licensing rules change; confirm with your board before you apply or buy. This page is research, not legal or financial advice.
