How to Check a Contractor's License, Bond, and Insurance

Verifying a contractor's license, bond, and insurance takes about ten minutes and can save you from a lawsuit, a lien on your home, or paying twice to have botched work redone. It's the single most-skipped step in hiring — and the one that separates homeowners who get burned from those who don't. Nobody enjoys paperwork, but this is the ten minutes that protects the tens of thousands of dollars you're about to spend.

The three things — license, bond, insurance — do different jobs. The license proves competence and gives you a regulator to complain to. The bond gives you a fund to recover from if the job is abandoned. The insurance keeps their accidents from becoming your bills. Here's exactly how to check all three.

Step 1: Check the license on the state board

Most states license general contractors and specialty trades — electricians, plumbers, HVAC techs, and often roofers. Verification is free and public.

• Go to your state's contractor licensing board website. (Search your state name plus "contractor license lookup"; nearly every state has one.)
• Enter the contractor's name, company, or license number.
• Confirm four things: the license is active (not expired or suspended), it's the right classification for your job, the name matches who you're hiring, and there's no disciplinary history or unresolved complaints.

If your state doesn't license the specific trade, check for a local (city or county) license or registration instead. An expired, suspended, or missing license for work that requires one is a hard stop — you'd have no bond, likely no insurance, and no regulator to turn to. That's the first of the 11 contractor red flags worth walking away from.

Step 2: Verify the bond

Many states require licensed contractors to carry a surety bond. A bond isn't insurance for you directly — it's a financial guarantee that gives you a path to file a claim and recover money if the contractor abandons the job, fails to pay subs, or violates licensing law.

Ask for the bond number and the surety company, then confirm it's active — sometimes visible right on the state board lookup, or verifiable with the surety. Note the bond amount; on a large project, a small bond may not fully cover a worst-case loss, which is exactly why insurance (next step) matters too.

Step 3: Confirm insurance — the right way

This is where homeowners get lazy, and it's the most financially dangerous step to skip. Two coverages matter:

• General liability insurance. Covers damage the contractor causes to your property — a cracked slab, a fire, water damage. Without it, that damage is your loss.
• Workers' compensation insurance. Covers medical bills if a worker is injured on your property. Without it, an injured worker can pursue a claim against you, the homeowner — a genuinely catastrophic risk on jobs involving heights or heavy work.

The critical detail: don't accept a photo of an insurance card. Ask for a certificate of insurance sent directly to you from the contractor's insurance agent or carrier, and confirm the policy dates are current. A legitimate contractor arranges this in a day; reluctance or excuses tell you what you need to know.

Why this protects your wallet

Picture the worst case for each gap. No license: the contractor does non-code work, disappears, and you have no board to complain to and no legal standing in many states. No bond: the contractor takes your deposit and vanishes, and there's no fund to claim against. No general liability: a worker puts a foot through your ceiling and the repair is on you. No workers' comp: a roofer falls off your roof and their medical and lost-wage claim lands on your homeowner's policy — or in court against you.

Ten minutes of verification neutralizes all four scenarios. That's the highest hourly return you'll earn on the entire project.

A quick verification checklist

Run this before you sign:

1. License looked up on the state board — active, correct class, matching name, clean record.
2. Bond number and surety confirmed active (where required).
3. Certificate of insurance received directly from the insurer, showing current general liability.
4. Workers' compensation confirmed if the contractor has any employees.
5. Permit responsibility confirmed — the contractor pulls it in their name.

If any line can't be cleared, pause. Combine this with the interview in 19 Questions to Ask a Contractor and the full process in How to Hire a Contractor.

What to look for on the certificate of insurance

When the certificate arrives, don't just file it — read it. A few things worth confirming:

• The named insured matches the company you're hiring. If the contract is with "ABC Remodeling LLC," the certificate should say the same — not the owner's personal name or a different entity.
• The policy dates are current and cover the period your project will run.
• The coverage types and limits are listed — general liability with a reasonable limit, and workers' compensation if they have employees. On a large job, thin liability limits are worth a conversation.
• The producer (agent) contact is on the form, so you can call to confirm it's genuine if anything looks off.

For a big project, you can even ask to be listed as a certificate holder, which prompts the insurer to notify you if the policy is cancelled mid-job. That's belt-and-suspenders, but on a major remodel or roof it's a reasonable ask.

Don't stop at credentials

Verification tells you a contractor is legitimate and covered — it doesn't tell you they do good work. Pair the license and insurance check with references you actually call and, ideally, a look at a recent job like yours. A contractor can be perfectly licensed and insured and still be slow, sloppy, or hard to communicate with. Credentials are the floor you don't go below; references and a detailed contract are how you clear the bar from there.

FAQ

How do I find my state's licensing board? Search your state's name plus "contractor license lookup" or "contractor license board." Almost every state runs a free public database where you search by name or license number.

What if my state doesn't license this trade? Some trades aren't licensed at the state level everywhere. Check for a city or county license or registration, and lean harder on the insurance verification, references, and a detailed contract.

Is a photo of an insurance card good enough? No. Cards can be outdated or doctored. Insist on a certificate of insurance sent to you directly by the contractor's agent or carrier, and check the policy dates.

Does the homeowner's insurance cover a contractor's mistakes? Don't count on it, and even if it responded, you'd face deductibles and premium hikes. The contractor's own liability and workers' comp coverage is what should absorb their accidents.

Bonded vs. insured — what's the difference? A bond is a financial guarantee that gives you a way to recover if the contractor fails to perform or pay subs. Insurance covers accidents and property damage. You want both — they cover different risks.

The contractor uses subcontractors — whose insurance matters? Both. The general contractor should carry their own liability and workers' comp, and their subs should carry theirs. Ask how the contractor verifies that their subs are insured, so an uninsured sub's accident doesn't become your problem.

How current does the insurance certificate need to be? The policy must be active for the entire period your project runs. Check the effective and expiration dates on the certificate, and for a long job, ask to be listed as a certificate holder so you're notified if coverage lapses.

Ten minutes, three checks, and a certificate sent straight from the insurer. Do this every time, before every hire, and you close the door on the most expensive contractor disasters there are. Next, structure the money safely with Contractor Deposits & Payment Schedules.

This is general information for homeowners, not legal advice. Licensing and insurance requirements vary by state and locality. Always verify credentials directly with your state board and the contractor's insurer, and get a written estimate before authorizing work.