# California contractor insurance requirements > What California law says about workers' comp, contractor license insurance and indemnity clauses, and what to check on a contractor COI for a project there. Reviewed Oct 28, 2026 by Forsured. Source: https://forsured.ai/coi-requirements/california/ ## The short version - Workers' comp required at: 1 employee - License insurance minimum: Workers' comp on file; LLCs $1M - Anti-indemnity statute voids: Sole negligence; active negligence on most private jobs ## Workers' comp in California Every California employer with one or more employees must carry workers' comp. Going without it is a crime. An uninsured employer faces a misdemeanor with a fine of at least $10,000, penalties of up to $100,000, and a stop order that bars using employee labor until coverage is in place. Agency: [California Division of Workers' Compensation](https://dir.ca.gov/DWC/faqs.html) ## Contractor licensing and insurance The Contractors State License Board (CSLB) requires a workers' comp certificate, or an exemption if the contractor has no employees, and a $25,000 license bond. Roofing (C-39) contractors must carry workers' comp even with no employees. A law passed in 2021 (SB 216) set January 1, 2026 as the date every licensee would need workers' comp, employees or not. A 2024 law (SB 1455) pushed that to January 1, 2028. Contractors licensed as LLCs must also carry at least $1 million in liability insurance (up to $5 million, depending on how many people are listed on the license). ## Indemnity and additional insured clauses California Civil Code § 2782 voids construction clauses that make a contractor indemnify another party for that party's sole negligence or willful misconduct, with stricter limits on residential projects. For most private contracts signed since 2013, § 2782.05 also voids clauses that make a lower-tier contractor cover the active negligence of the contractor above it. ## The CSLB license is a quick check A CSLB license lookup shows whether a contractor has a workers' comp certificate or an exemption on file. A contractor claiming an exemption has told the state it has no employees, so if it shows up with a crew, ask. ## What to check on a contractor COI for a California project 1. **Workers' comp.** Nearly every contractor with employees needs it in California. A contractor with a crew and no workers' comp on its COI is a gap. For an out-of-state contractor, confirm California is listed on the workers' comp policy. 2. **General liability.** A California license only shows the contractor met the state's floor. Compare each limit on the COI with your project requirements, which are usually higher. 3. **Additional insured.** The endorsement is a separate promise from the indemnity clause, so check both. Ask for the endorsement itself, not just a box ticked on the certificate. 4. **Dates.** Every policy should run through the end of the job. A COI only shows coverage on the day it was issued, so check again at each renewal. ## Common questions ### Do contractors need workers' comp in California? Every California employer with one or more employees must carry workers' comp. Going without it is a crime. An uninsured employer faces a misdemeanor with a fine of at least $10,000, penalties of up to $100,000, and a stop order that bars using employee labor until coverage is in place. ### Does California require contractors to carry general liability insurance? The Contractors State License Board (CSLB) requires a workers' comp certificate, or an exemption if the contractor has no employees, and a $25,000 license bond. Roofing (C-39) contractors must carry workers' comp even with no employees. A law passed in 2021 (SB 216) set January 1, 2026 as the date every licensee would need workers' comp, employees or not. A 2024 law (SB 1455) pushed that to January 1, 2028. Contractors licensed as LLCs must also carry at least $1 million in liability insurance (up to $5 million, depending on how many people are listed on the license). ### Can a California construction contract make a contractor cover another party's negligence? California Civil Code § 2782 voids construction clauses that make a contractor indemnify another party for that party's sole negligence or willful misconduct, with stricter limits on residential projects. For most private contracts signed since 2013, § 2782.05 also voids clauses that make a lower-tier contractor cover the active negligence of the contractor above it. ## Sources 1. [Answers to frequently asked questions about workers' compensation for employers](https://dir.ca.gov/DWC/faqs.html), California Department of Industrial Relations 2. [Industry bulletin: workers' compensation requirements (SB 216)](https://cslb.ca.gov/Resources/IndustryBulletins/2022/Industry_Bulletin_workers_comp.pdf), Contractors State License Board, 2022 3. [California governor signs bill to delay comp mandate for contractors](https://www.businessinsurance.com/california-governor-signs-bill-to-delay-comp-mandate-for-contractors/), Business Insurance, Sep 2024 4. [Licenses for limited liability companies (LLC)](https://web.cslb.ca.gov/About_Us/LLC.aspx), Contractors State License Board 5. [Anti-Indemnity Statutes in All 50 States (2023)](https://grsm.com/wp-content/uploads/2023/10/Anti-Indemnity-Statutes-2023.pdf), Gordon Rees Scully Mansukhani, 2023 6. [State Workers' Compensation Officials](https://www.dol.gov/agencies/owcp/wc), U.S. Department of Labor General information, not legal advice. Confirm with the state agency, your broker or your attorney. --- Forsured: construction insurance compliance software. https://forsured.ai · hello@forsured.ai