Question 1

What insurance does the CSLB require for California contractors?

Accepted Answer

The Contractors State License Board (CSLB) requires all licensed contractors to maintain either a general liability insurance policy with at least $1 million in coverage or a $15,000 contractor's bond. Additionally, all contractors with employees must carry workers' compensation insurance. Some license classifications have additional bonding requirements.

Question 2

How much does construction insurance cost in California?

Accepted Answer

California construction insurance costs range from $8,000–$25,000/year for a comprehensive package. Workers' comp is the largest line item — rates vary by trade from $5/100 payroll (electrical) to $30/100 (roofing). General liability averages $3,000–$8,000/year. Your experience modification rate (mod rate) significantly impacts workers' comp costs — a mod rate below 1.0 can save thousands annually.

Question 3

Do California subcontractors need their own insurance?

Accepted Answer

Yes. California law requires all employers to carry workers' compensation regardless of size. Most general contractors also require subcontractors to carry their own general liability (typically $1M–$2M), commercial auto, and often umbrella coverage. The GC usually requires being named as an additional insured. Operating without proper insurance can result in CSLB license suspension.

Question 4

What is CalOSHA and how does it affect construction insurance?

Accepted Answer

CalOSHA is California's state-run workplace safety agency, which enforces standards stricter than federal OSHA. CalOSHA conducts more frequent inspections and levies higher fines — up to $156,259 per serious violation. A strong safety program that reduces CalOSHA violations also lowers your experience modification rate, directly reducing workers' comp premiums.

California Construction Insurance | RISKX