Guide To Understanding General Contractor Bonds And Licenses

Everyone is familiar with the proverbial advice to look for bonds, insurance, and licenses for contractors. Each state has its own regulations for general contractors in terms of licenses, insurance, and bonds. For some positions in the construction business, having the proper insurance and bonding may be necessary to keep you financially secure. Most people need to be made aware of general contractors, their licenses, bonds, or certificates. You will gain a thorough understanding of general contractors through this manual.

What Is A Certified General Contractor?

A licensed general contractor is a person or business that has been granted authorization by the state government to lawfully provide construction services. This kind of contractor often has extensive expertise in all facets of construction, including project management, planning, and execution. Before starting work, they must have the credentials required by their state and get any applicable permits.

When Do You Need A General Contractor Business License?

Before accepting your first project, you might need to acquire a general contractor license from the state licensing board or secretary of state, depending on where you live. Even if it’s not necessary for your state, it’s crucial to investigate local authorities because they can have professional license requirements.

It may not be necessary for those working on modest home improvement projects for various homeowners to hold a general contractor’s license, depending on the nature of the work and the scope of each project.

When the cost of labor and materials exceeds a certain level or when performing particular services, such as plumbing, roofing, electrical, or HVAC repair, you might need to obtain a license.


What Distinguishes A General Contractor From An Unlicensed Handyman?

A general contractor and a handyman differ mostly in their ability to handle larger projects and their trade-specific knowledge. A handyperson will often have their own tools, but they might not have the skills or authorization required for a certain project. If you need to replace a door or a leaking roof, a handyman is usually an excellent option, but if you want to expand your entire home, you should consider hiring a general contractor.

How May A General Contractor License Be Obtained?

Application requirements for contractor licenses vary by location. Contractors normally need to be 18 years of age or older, demonstrate that they have training or work experience in the industry, and successfully complete a test. In most cases, general contractors must pay both an application fee and a license fee, which may need to be renewed. You can be required to carry general contractor insurance, such as workers’ compensation and general liability insurance.

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