Learn everything contractors need to know about surety bonds and California licensing requirements.
Surety Bonds for Contractors
Surety bonds are a form of financial guarantee that protects project owners if a contractor fails to fulfill their obligations. Unlike insurance, a surety bond is a three-party agreement between the contractor, the project owner, and the surety company.
Types of Surety Bonds
Common types include bid bonds, performance bonds, payment bonds, and license and permit bonds. Each serves a different purpose in the contracting process.
California Requirements
The California Contractors State License Board (CSLB) requires licensed contractors to carry a $25,000 contractor's license bond.