An announcement from the Contractor State License Board states that all licensed contractors, regardless of whether they have employees, will need insurance by 2026.
What is the new workers’ compensation insurance law?
Starting January 1, 2023, concrete (C-8), HVAC (C-20), asbestos abatement (C-22), and tree service (D-49) contractors will be required to have workers’ compensation insurance, regardless of whether they have employees.
The new requirement is the result of Contractor State License Board (CSLB)-sponsored Senate Bill 216, which Governor Gavin Newsom signed into law on September 30, 2022. The bill also requires that all contractors – with or without employees – will need to have workers’ compensation insurance by January 1, 2026.
Why is this important to me and my business?
Currently, only C-39 Roofing contractors are required to have workers’ compensation insurance, regardless of whether they have employees. CSLB research confirms that many of the approximate 50 to 60 percent of licensed contractors who currently claim an exemption to workers’ compensation insurance do use employees.
This problem creates an unfair competitive disadvantage for law-abiding contractors who are subject to higher business costs and puts employees and the public at risk for workplace injuries. CSLB hopes to protect the public and level the playing field for law-abiding contractors by requiring more contractors to carry workers’ compensation insurance starting in 2023 and eventually all contractors by 2026.
Consumers can verify a contractor’s license status and whether a contractor has
workers’ compensation insurance by checking on the CSLB website.
Get the workers’ compensation insurance you need
Staying up to date on contractor compliance is important to keep your business and employees protected from risk. Our team of insurance experts will help you determine the best plan for your business.