Are you thinking of launching a construction business in California? If you want to work on construction projects that cost more than $500, you’ll need a California contractor license. This statewide license is necessary for constructing or modifying buildings, highways, roads, parking facilities, railroads, excavations, and any other construction projects in the state.Â
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Becoming a licensed contractor gives you a competitive advantage, as you can market yourself to new clients as a trustworthy partner. It’s a sign you have state approval and the necessary know-how. The license allows you to work on larger commercial and residential projects too. We'll take you through the process of getting your contractor license in California.
#1. Get to Know the Types of Contractor Licenses
While you can perform work below $500 as an unlicensed contractor, getting licensure is a great business move—so you can work on larger projects and gain the trust of your customers.
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So how do you get your license? Your first step is to research the different types of California contractor licenses. They are issued by the Contractors State License Board (CSLB) at the California Department of Consumer Affairs.
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The license classifications for general contractors include:
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- Class A: General Engineering Contractor—engineering and technical specialist
- Class B: General Building Contractor—general contractor who can hire subcontractors and specialty contractors for larger projects that require the work of at least two trade specialists
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The license classification for specialty contractors is:
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- Class C: Specialty Contractor—contractors with special skills in a certain field
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You can choose among 43 different Class C subclassifications corresponding to specific trades. They include carpentry contractors, HVAC specialists, roofing contractors, electricians, swimming pool contractors, and the like.Â
#2. Find Out the Contractor Licensing RequirementsÂ
You’ll have to meet slightly different criteria for each of the license classifications. However, some of the requirements apply for all license types, such as:
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- Proof you’re 18 years of age
- Your Social Security Number or Individual Taxpayer Identification (ITIN)
- Information about the owners and the business entityÂ
- Information about the Qualifying Individual (who meets the work experience criteria)Â
- Certification of Work Experience form for the Qualifying IndividualÂ
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After you submit the license application to the State of California, there’s still some work to do. You’ll also have to:
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- Undergo fingerprinting
- Pass the state exam
- Get a $15,000 surety bond
- Get workers’ compensation insurance for hiring employees or an exemption if you won’t employ other people
#3. Meet the Training and Experience Criteria
California has strict rules for the professional experience required of contractors.Â
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You’ll need to show at least four years of experience as a journeyperson, foreperson, or supervising employee in the field. This has to be from the last ten years. Proof of experience is necessary for the Qualifying Individual on your application, which can be either you or another person who has the required experience.Â
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If you have completed training in an accredited school or an apprenticeship program in the construction industry, that may count as up to three years of experience. You’ll need to include the names of tutors or specialists who can confirm your training or work.  Â
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You can also get credits for meeting this requirement if you have military experience and training. You’ll need to provide your relevant records and transcripts. Â
#4. Submit Your Contractor License Application
Once you have collected all the required documents, it’s time to fill in and send your application. You can do this online or by mailing it to:
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California Contractors State License Board
P.O. Box 26000
Sacramento, CA 95826
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The fees you’ll have to pay include:Â
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- $330 application fee—at the time of applying
- $200 license fee for a two-year term—once you’re approvedÂ
- $75 license fee for any additional license you’re applying for—once you’re approved
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If you apply for one license, the total cost of your California contractor license will be $530.Â
#5. Pass the Exam and Get Your License
If your application is complete, you’ll receive a Notice to Appear for Examination. You’ll have about three weeks before the exam date—time to get ready! Â
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You’ll then have to pass the California Law and Business exam. Some of the topics covered include construction safety, project contracts, and budgeting and finances. Don’t forget to check out the Board’s Study Guide for preparation tips.Â
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Applying for a specialty license? You’ll also have to complete a trade exam. You’ll need this for your electrical, roofing, HVAC, and other types of specialty contractor licenses. Good news: if you have a corresponding contractor license in Arizona, Louisiana, Nevada, or Utah, you may qualify for a reciprocity waiver for the trade exam.
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Once you pass the exams, the Board will issue your license. You’ll receive your certificate and card within one week. Then you’re ready to start your work as a licensed contractor.
Time Tracking and Payroll for California Contractors
Do you need help with handling the administrative tasks for your contracting business?
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Hourly helps you manage time tracking and payroll. What’s more, you can connect your workers’ comp right to payroll to eliminate audit bill surprises and save money. Plus, you can keep an eye on payroll deductions and labor costs with ease.Â
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Ready to try it out? Download our payroll app and get started.
1. Introducing Yourself
Your introductory email needs to pack a lot of information into a small package. Try something like this:
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Hello Jane,
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My name is John Doe and I work for ABC Agency, where we provide business insurance policies to many of Dallas' rockstar small businesses.
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Congratulations on your new business, Jane's Bakery. Are you wondering if you have all the insurance you need? Or if your policies will really cover you in a pinch?
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At ABC Agency, we pride ourselves on providing robust, comprehensive coverage options to companies like yours with flexible, pay-as-you-go plans.
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Are you available this week to talk more about how we can help? I can help you find the most affordable rates and the best policies out there.
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I look forward to speaking with you soon.
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Cheers,
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John Doe
2. Presenting a Quote
Once you've met with your potential client, a quick reply with their quote will get the ball rolling.
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Hi Jane,
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Thanks so much for meeting with me this morning. I loved touring Jane's Bakery–I can still smell those delicious chocolate chip cookies baking! You have a great location, and I'm sure you're going to do great on Front St.Â
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After reviewing my notes, I've pulled together an insurance quote for you (attached). I recommend a business owner's policy. A BOP includes several insurance products in one: liability, property insurance, and business interruption insurance. It offers robust coverage at a competitive price.
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I'll call you in a few days to see what you think about this insurance plan. In the meantime, if you have any questions, don't hesitate to email me or call me at [phone number].
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Again, thank you for your time today. I look forward to working with you in the future.
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Cheers,
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John Doe
3. Thanks for Purchasing a Policy
Gratitude is important! It's never a bad idea to thank your clients for their business.
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Hi Jane,
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Thank you for choosing a business owner's policy with ABC Agency. We know it's so important to get the right coverage for your business, and we are honoured you've placed your trust in us.
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We're excited to work closely with you, and our no. 1 goal is to make sure you're business is always protected.Â
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Do you have any questions? We are here to help. Reach out whenever something comes to mind.
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Thank you again for choosing ABC Agency to insure Jane's Bakery.
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Cheers,
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John Doe
4. Welcome Email
A welcome email helps clients feel like you're there to help–and can softly pitch other insurance products you offer.
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Dear Jane,
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Welcome to the ABC family! We are thrilled to have you as a new customer and can't wait to meet all of your insurance needs.
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As an independent insurance agency, we work with multiple insurance providers to find the best coverage options for all our customers. If you need any other type of insurance–like [include additional offerings unique to your agency, like life insurance, health insurance, home insurance or anything else]–we can help you too.
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Do you want to discuss any of these policies?
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Cheers,
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John Doe
5. Introducing a New Product
A happy client may want to expand their business with you.
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Hello Jane,
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I hope all is well with you and Jane's Bakery. I stopped in yesterday for a blueberry muffin and coffee, and they were delicious. I loved the hint of cinnamon in the muffin! Was that your idea?
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I wanted you to be the first to know we are now offering commercial vehicle insurance to our policyholders. Auto insurance for your catering vans is super important since your personal car insurance won't cover them.
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We're offering this insurance coverage solely to our current business clients at the moment and have some very competitive rates.
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Would you like me to work up a quote for you?Â
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As always, thanks so much for being a part of the ABC family.
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Cheers,
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John Doe
6. Asking For Referrals
Once your relationship is established and comfortable, let your clients help you grow.
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Hi Jane,
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You've been a valuable member of the ABC family for two years now, and we so appreciate your business–not to mention the muffins you supply for our monthly meetings!
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Because you are a valued policyholder, I wanted to ask a quick favour. I know you are active in the local Chamber of Commerce, and I'm hoping you might know some colleagues who would benefit from working with our insurance company.
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Referrals are one of the most effective ways to connect with our community since people really trust their friends, family and colleagues. Is there anyone you'd recommend I speak with?
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Remember that in addition to business insurance products, we offer everything from life insurance policies to pet insurance.
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As a thank you for your help, we will send you an Amazon gift card of $100 when your referrals buy insurance from us.
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Thanks so much for your help!
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Cheers,
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John Doe
7. Policy RenewalÂ
If your client needs to renew their policy with you, send an email like this:
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Hi Jane,
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I hope you're doing well! What a year it's been—from being listed as one of the top 5 bakeries in Dallas to being an official vendor for the city—you have so much to be proud of.
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Just a heads up that your business owner's policy is up for renewal soon and will expire on June 15, 2023.Â
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If you're still happy with the coverage, we can easily renew it for you.Â
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Do you have some time to chat this week?
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Looking forward to serving you again!
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Cheers,
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John Doe