How to Check if a Contractor Is Licensed and Insured

Most homeowners never check. They get a referral from a neighbor, meet a contractor who seems confident, and sign an agreement because the price is right and the guy seemed trustworthy. Then something goes wrong — a worker gets hurt, a pipe bursts, a roof fails in the first storm — and they discover, too late, that the contractor had no real license and a lapsed insurance policy. Now the homeowner is holding the bill.

This guide exists so that doesn’t happen to you. We’re going to walk through exactly what to check, where to check it, and what to do when the answers aren’t what you expected.

This isn’t complicated. You don’t need legal training or construction experience — you just need to know what to look for, and now you will.

This article is part of our broader resource, The Complete Guide to Hiring a Contractor: How to Protect Your Home and Your Money. Once you’ve nailed down the license and insurance checks, that guide will show you every other step in the vetting process.

Why License and Insurance Are the Two Most Important Things to Check

What is the actual financial risk of hiring an unlicensed contractor?

Let’s put a number on it. The average home improvement project in the United States runs between $15,000 and $75,000, depending on the scope of work. When something goes wrong with a licensed, bonded, and insured contractor, you have legal recourse — you can file a complaint with the state licensing board, pursue a bond claim, or take them to court with a paper trail that supports your case. When something goes wrong with an unlicensed contractor, you are largely on your own.

Courts in many states will void a contract if the contractor performing the work was unlicensed. That sounds like it would help you — it doesn’t. It can mean the contractor has no legal obligation to finish or repair anything, and you may not be able to recover money already paid. In some states, an unlicensed contractor who sues you for payment can actually win — while you have no ability to countersue for defective work.

The insurance side of the equation is just as dangerous. If a worker is injured on your property while working for an uninsured contractor, your homeowner’s insurance is often the last line of defense — and it may not cover the full liability. In serious injury cases, homeowners have been successfully sued for amounts that far exceeded their policy limits.

These aren’t edge cases. The National Insurance Crime Bureau and the Federal Trade Commission both document thousands of contractor fraud cases annually, with property damage estimates running into the hundreds of millions of dollars. The common thread in nearly every case is a homeowner who didn’t verify credentials before work began.

Why do so many homeowners skip this step?

There’s a social discomfort involved. Asking a contractor to prove their credentials can feel accusatory — like you’re suggesting they might be dishonest. Legitimate contractors understand this and don’t take it personally. If a contractor reacts with defensiveness or offense when you ask to verify their license and insurance, that reaction is itself a warning sign worth taking seriously.

Many homeowners also simply don’t know where to look. They’ve never had to use a state licensing board’s website, and the process sounds more technical than it actually is. This guide removes that barrier entirely. By the time you finish reading, you’ll know exactly where to go and what to look for in any state in the country.

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What Contractor Licensing Actually Means

Are all contractor licenses the same?

No — and this is one of the most important things homeowners get wrong. There is no single national contractor’s license in the United States. Licensing is regulated at the state level, and in some cases at the city or county level, with requirements varying dramatically from one jurisdiction to the next. A contractor who is fully licensed in California may not meet the requirements to legally work in Tennessee, and a general contractor’s license in one state may not cover the same scope of work as the same license category in another.

Some states are tightly regulated — Florida, California, and Nevada require extensive testing, proof of experience, financial solvency documentation, and continuing education to maintain a contractor’s license. Other states have minimal requirements, or require licensing only for specific trades like electrical and plumbing while leaving general construction largely unregulated. Understanding your state’s system is step one.

What is the difference between a general contractor license and a trade license?

A general contractor (GC) license typically authorizes a contractor to manage overall construction projects — framing, roofing, siding, and general remodeling work. A trade license is specific to a licensed trade, such as electrical, plumbing, HVAC, or structural engineering. Trade licenses generally require more rigorous testing because the work involves systems where mistakes carry greater safety risk.

A licensed general contractor can often pull permits for projects and may hire licensed subcontractors to perform trade work. But a GC license does not entitle someone to do licensed electrical work themselves. If you are hiring someone to rewire a panel or replace a gas line, verify that they hold the specific trade license for that work — not just a general contractor registration.

What does state-level versus local licensing mean for your project?

Some states issue one master license that is valid statewide. Others require contractors to register or obtain an additional license in each municipality or county where they work. In Ohio, for example, the state licenses HVAC contractors and electrical contractors at the state level, but many cities — including Columbus, Cleveland, and Cincinnati — require additional local registration before a contractor can pull permits within city limits.

This matters for you as a homeowner because a contractor may legitimately hold a state license but still be operating outside their authorized territory at the local level. When in doubt, call your local building department and ask whether the contractor you’re considering has an active registration in your jurisdiction. This single phone call has saved homeowners from project delays, failed inspections, and permit revocations.

Does a license guarantee quality work?

A license does not guarantee craftsmanship. What it does guarantee is that a contractor has met the minimum legal requirements to operate in their trade — passing tests, carrying required insurance, and submitting to state oversight. Licensed contractors can be disciplined, suspended, or have their licenses revoked for substandard work, fraud, or consumer complaints. That accountability structure simply does not exist with unlicensed operators.

Think of a license as the floor, not the ceiling. You still need to evaluate experience, references, and permit history — which is why we recommend pairing this check with a full permit history review. You can learn more in our companion article: How to Check a Contractor’s Permit History and Why It Matters.

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How to Look Up a Contractor’s License in Any State

Where do you go to verify a contractor’s license online?

Every state with contractor licensing requirements maintains a public lookup database, usually administered by a department with a name like the Department of Consumer Affairs, the State Contractors Board, the Division of Professional Licensing, or the Department of Commerce. The quickest way to find yours: search for “[your state] contractor license lookup” in any browser, and the official .gov site should appear near the top of the results.

A few of the most commonly used state portals include: California’s Contractors State License Board (cslb.ca.gov), Florida’s Department of Business and Professional Regulation (myfloridalicense.com), Texas’s Department of Licensing and Regulation (tdlr.texas.gov), and Ohio’s eLicense system (elicense.ohio.gov). Each state’s portal looks different, but they all offer the same core function: a public search where you can verify license status, expiration date, and disciplinary history.

What information do you need to run a license search?

You typically need one of three pieces of information: the contractor’s full legal name, their business name, or their license number. Most legitimate contractors will include their license number on their business card, website, estimate forms, or email signature. If you have the license number, searching by that is the fastest and most accurate method — names can be misspelled or shared across multiple contractors.

If the contractor doesn’t readily offer their license number, simply ask: “Can you give me your state contractor license number so I can verify it before we move forward?” This is a completely normal question. If they hesitate, make excuses, or claim the number is “on file at the office,” that hesitation is a warning sign.

What should you see in the search results?

A clean license lookup result should show: the contractor’s legal name or business entity, their license classification (general contractor, electrical, plumbing, HVAC, etc.), the current status (Active is what you want — not Expired, Suspended, or Revoked), and the license expiration date. Many state databases also show the date the license was originally issued, which gives you a rough sense of how long they’ve been operating under this credential.

Pay close attention to any disciplinary actions, complaints, or administrative actions listed. A single minor administrative note is usually not disqualifying. A pattern of complaints, a suspension history, or a revocation and reinstatement should prompt serious additional research — and possibly walking away entirely.

What if your state doesn’t have a centralized license database?

A small number of states have limited statewide licensing for general contractors, relying instead on county or municipal licensing systems. If you live in one of these states — such as parts of Texas outside its licensed trade categories, or certain rural jurisdictions — your primary verification point shifts to your local building department. Call them and ask whether the contractor you’re considering has pulled permits locally and whether they are in good standing with your jurisdiction.

You can also check whether your state requires registration (rather than full licensing) for contractors. Registration is a lower bar than licensing — it typically just requires a contractor to file with the state and carry insurance — but it still creates a paper trail and some level of oversight. Ask for a registration number and verify it the same way.

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What to Do When a Contractor Claims to Be Licensed but You Can’t Verify It

What are the most common reasons a license search comes up empty?

There are a few innocent explanations and a few that are not. On the innocent side: the contractor may be licensed under a business name that differs from what you searched, the database may have a lag in updating recently renewed licenses, or the contractor may hold a license in a neighboring state and mistakenly believes it covers work in yours. These situations are worth a quick conversation before drawing conclusions.

On the concerning side: the license may have lapsed and the contractor is continuing to work without renewing, the license may have been revoked and they’re hoping you don’t check, or they may have fabricated a license number entirely. This last scenario is more common than most homeowners realize — particularly with door-to-door contractors or those responding to storm damage situations when competition is high and oversight is thin.

How do you follow up when the results don’t match what you were told?

Start with a direct conversation. Tell the contractor what you searched, what you found (or didn’t find), and ask them to explain the discrepancy. Ask them to provide a physical copy of their license — the actual certificate or card issued by the state — not just a number recited from memory. A legitimate contractor will have this documentation readily available and will not be threatened by the request.

If they provide a document, cross-reference every detail: name, license number, issue date, expiration date, and classification. Then go back to the state database and enter the exact number shown on the document. If the results still don’t match — or if the document looks unofficial, hand-altered, or unprofessionally formatted — treat it as a forgery and walk away from the project entirely.

Should you report a contractor who gave you a false license number?

Yes. Operating without a required license, or representing yourself as licensed when you are not, is typically a criminal offense in states that require licensing. File a report with your state’s contractor licensing board and with your state attorney general’s consumer protection division. This protects other homeowners from encountering the same contractor and contributes to a paper trail that can support future enforcement actions.

You can also file a report with the Better Business Bureau, which maintains complaint histories that are publicly visible. Our guide to reading BBB reports explains how those records can help other homeowners make informed decisions: How to Read a Contractor’s BBB Report Before You Hire.

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The Difference Between General Liability Insurance and Workers’ Compensation — Why You Need Both

What does general liability insurance actually cover?

General liability (GL) insurance covers property damage and bodily injury caused by the contractor’s work — to third parties, including you and your home. If a contractor’s crew accidentally breaks through a load-bearing wall, floods your basement, or causes a fire while soldering pipe, their general liability policy is what pays for the resulting damage. Without it, you’re filing that claim against your own homeowner’s insurance, paying your deductible, and potentially watching your own premium increase for a loss you didn’t cause.

For residential projects, most homeowners should require a minimum of $1,000,000 per occurrence in general liability coverage. Larger projects — full additions, roof replacements over $50,000, or any work involving structural changes — warrant asking for $2,000,000 or more. These numbers sound large until you compare them against the actual cost of repairing a fire caused by a careless subcontractor working inside your walls.

What does workers’ compensation insurance cover and why does it protect you?

Workers’ compensation (workers’ comp) insurance covers medical expenses and lost wages for workers who are injured on the job. Here is the part most homeowners don’t realize: if a contractor’s employee is injured on your property and that contractor does not have workers’ comp, the injured worker may have the legal right to pursue a claim against you as the property owner. Your homeowner’s insurance may or may not cover this, depending on your policy language and the jurisdiction.

Construction and remodeling work consistently ranks among the most physically dangerous categories of work in the United States. Falls from heights, electrical contact, tool injuries, and overexertion claims are common. A single serious injury — a broken leg from a ladder fall, a back injury from material handling — can generate medical bills and litigation costs well into the six figures. Workers’ comp ensures that liability lands with the contractor’s insurance, not with you.

Are there any exceptions to the workers’ comp requirement?

In most states, sole proprietors with no employees are exempt from carrying workers’ comp on themselves — meaning a truly solo operator working alone has no legal obligation to insure himself under workers’ comp law. If this is the case, get that in writing from the contractor and verify that they are genuinely operating alone without any helpers, day laborers, or subcontractors. The moment a second person shows up on your project, the workers’ comp question becomes very real.

Some contractors also attempt to classify workers as “independent subcontractors” to avoid the workers’ comp requirement. Courts and state labor boards frequently challenge these classifications, and if a misclassified worker is injured, the liability can still flow back to the primary contractor — and potentially to you as the property owner. When in doubt, require workers’ comp for any project involving more than one worker on site.

Does a contractor’s bond replace the need for insurance?

No. A contractor’s bond and insurance are completely different instruments. A surety bond typically guarantees that a contractor will complete a project according to contract terms — it’s a financial guarantee that protects you from abandonment or non-completion. Insurance protects against accidental damage, injury, and liability that arises during the work. Both have value, but neither replaces the other.

Many state licensing requirements include bonding as a condition of licensure, so a licensed contractor may already carry a bond — but that is entirely separate from their liability insurance coverage and does not substitute for it.

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How to Verify a Contractor’s Insurance Certificate

What is a Certificate of Insurance and what should it include?

A Certificate of Insurance (COI) is a one-page summary document issued by an insurance company that confirms a policy exists. The standard form used in the United States is the ACORD 25, a recognizable format that any insurance agent can produce within minutes. When a contractor provides you with a COI, it should show: the insurance company’s name and contact information, the contractor’s name and business entity, the policy type (general liability, workers’ comp), the policy number, and the coverage effective dates — including the expiration date.

The most critical date on the certificate is the policy expiration. If the policy expired last month and the contractor handed you a certificate with last year’s date, that certificate is worthless. Verify that the expiration date extends beyond your project’s expected completion date, not just beyond today.

How do you verify that the certificate is real and current?

This is the step that separates homeowners who are truly protected from those who merely feel protected. A certificate of insurance is easy to alter in any basic document editor — the date can be changed, the coverage amounts inflated, and the policy number fabricated. The only way to confirm that a policy is real and active is to call the insurance company listed on the certificate directly.

Find the insurance company’s published customer service number — look it up independently rather than calling the number printed on the certificate, to avoid calling a number the contractor may have set up. Tell them you’re a property owner looking to verify coverage for a contractor you’re considering hiring. Give them the policy number shown on the certificate.

They will confirm whether the policy is active, the coverage type, and the coverage limits. This call takes about three minutes and is the single most important insurance verification step you can take.

Should you ask to be named as an additional insured?

For larger projects — anything over $10,000 or any project involving structural work, electrical upgrades, or full system replacements — yes. Requesting to be named as an additional insured on the contractor’s general liability policy means that if a covered claim arises from your project, your interests are explicitly protected by the policy. This is standard practice in commercial construction and is increasingly requested on residential projects of significant scope.

To get this done, the contractor simply needs to notify their insurance agent, who will issue an updated certificate or an additional insured endorsement. It typically costs the contractor nothing or very little to add. If a contractor refuses this request on a large project, ask them to explain why — their answer will tell you a lot about how they operate.

How much general liability coverage should you require for your project size?

Use this as a rough guide: for small projects under $10,000 (painting, minor repairs, landscaping), $500,000 per occurrence is a reasonable floor. For mid-size projects from $10,000 to $50,000 (kitchen remodels, bathroom additions, roofing), require at least $1,000,000 per occurrence. For large projects above $50,000 (full additions, full HVAC systems, foundation work), request a minimum of $1,000,000 per occurrence and ask about the aggregate limit — the maximum the policy will pay across all claims in a policy year.

Don’t let these numbers intimidate you. They are standard in the professional contractor industry. A properly established contractor with a real business carries these limits as a matter of course. If the contractor you’re talking to hasn’t thought about coverage limits, that tells you something important about how they run their operation.

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What Happens to You If a Contractor Is Uninsured and Something Goes Wrong

What is the most common scenario that catches homeowners off guard?

The most frequently occurring scenario involves property damage — a worker drops a ladder through your garage door, a misplaced saw cuts a water line, or improper flashing causes a roof leak that soaks your drywall over the following winter. You call the contractor and he doesn’t respond, or he says he can’t afford to fix it.

You call his insurance company and find out the policy number he gave you was expired or never existed. Now you’re filing a claim on your own homeowner’s policy — for damage the contractor caused.

Filing a claim on your homeowner’s policy for contractor-caused damage has real consequences. Your premium may increase at renewal, and depending on your insurer and claims history, you may face non-renewal. Your deductible — often $1,000 to $2,500 — comes out of your pocket first, all for damage that the contractor’s insurance should have covered entirely.

What happens if a worker is injured on your property with no workers’ comp in place?

This is the scenario with the greatest potential financial exposure. A worker injured on your property — even if he was technically employed by the contractor — may have legal standing to pursue a premises liability claim against you as the property owner. If the contractor has no workers’ comp policy, the injured worker’s attorney will look for any available source of compensation. Your homeowner’s liability coverage may respond, but standard homeowner’s policies are not designed to handle commercial construction injuries.

Standard homeowner’s liability coverage runs from $100,000 to $300,000. A serious construction injury — a fall with multiple fractures, a spinal injury, or a traumatic head injury — can generate medical bills and lost wage claims that exceed that amount many times over. Umbrella insurance policies can provide additional protection, but they won’t save you from a situation that proper contractor verification would have prevented entirely.

Can you sue an uninsured contractor to recover your losses?

In theory, yes. In practice, it is often not worth the cost. Small claims court handles amounts up to $5,000 to $10,000 in most states — quick, inexpensive, and accessible without an attorney. For larger amounts, civil litigation can easily cost $5,000 to $25,000 in legal fees before trial.

Even if you win a judgment against an uninsured contractor, collecting it requires that contractor to have assets worth seizing — and many uninsured operators run businesses without meaningful personal or business assets behind them.

The math is uncomfortable but clear: five minutes verifying a license and insurance certificate is worth more than years of litigation chasing an empty judgment. This is a situation where the prevention cost is essentially zero and the remediation cost can be devastating.

Does your homeowner’s insurance always cover contractor-caused damage?

Not always — and this is where many homeowners get a painful surprise. Most homeowner’s policies exclude or limit coverage for damage caused by work performed on the property, particularly if the work was performed without required permits. If an unlicensed contractor performed work that required a permit, and that unpermitted work later causes a fire or structural failure, your insurer may deny the resulting claim based on the lack of permits. Unlicensed, uninsured, and unpermitted work creates a compound liability exposure that can leave you entirely unprotected.

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The 5-Minute License and Insurance Check Every Homeowner Should Do Before Signing

What is the complete step-by-step process for a thorough credential check?

Step 1 — Get the license number. Before any signed agreement or deposit, ask the contractor for their full legal business name, their state contractor license number (or trade license number if the project involves licensed trade work), and their state of licensure. This should be freely available on their business card, proposal, or website. Write it down — do not rely on memory.

Step 2 — Look it up on the state licensing portal. Open your state’s contractor licensing lookup tool (find it by searching “[your state] contractor license lookup” and using the official .gov site). Enter the license number and verify: name matches, license type matches the work scope, status reads Active, and the expiration date is current. Note any disciplinary history.

Step 3 — Request a Certificate of Insurance. Ask for a current COI showing general liability and workers’ compensation coverage. Tell the contractor your project start date and confirm that both policies are active through the expected completion date. Do not accept a photocopy of an old certificate — the document should be dated within the last 30 to 60 days.

Step 4 — Call the insurance company to verify. Look up the insurance company’s phone number independently and call to confirm the policy is active and the coverage amounts match what the certificate shows. This one step eliminates the risk of forged or altered certificates. Ask the agent to email you a verification in writing if the project is large.

What should you do with everything you’ve confirmed?

Step 5 — Document and file. Take screenshots of the license lookup results showing the active status. Keep a copy of the COI with the project contract, and write down the name of the insurance agent you spoke with and the date of verification.

If the contractor’s license or insurance lapses during the project, you want documentation of what was in place when you signed — and clear evidence that any coverage lapse happened without your knowledge or consent.

This entire process — from requesting the license number to documenting the insurance call — takes under five minutes for a straightforward project with a reputable contractor. For more complex projects or any situation where you have concerns, allow more time and consider running a full background check before committing.

Are there any other red flags to watch for before signing?

Yes — several. A contractor who pressures you to sign quickly, offers a significant discount for immediate commitment, or tells you that permits “aren’t really necessary for this type of work” should be approached with serious caution. Legitimate contractors allow time for homeowners to do their due diligence because they have nothing to hide from the process. The more pressure you feel to skip verification steps, the more urgently you should run them.

Storm chasers — contractors who appear in your neighborhood immediately after a major weather event, often from out of state — warrant particular vigilance. They frequently operate without local licensing, carry minimal or lapsed insurance, and collect deposits before vanishing or completing substandard work. Always verify out-of-state contractors against both their home state licensing board and any local registration requirements in your jurisdiction.

How does checking credentials fit into the larger hiring process?

The license and insurance check is your first line of defense — the baseline that every contractor you seriously consider must pass before you invest more time in the evaluation. It runs in parallel with other important checks: reviewing their BBB complaint history, verifying their permit pull record with your local building department, calling references on completed projects, and reading their contract carefully before signing. Our hub resource covers all of these steps in full: The Complete Guide to Hiring a Contractor: How to Protect Your Home and Your Money.

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Frequently Asked Questions

Can a contractor legally work without a license if they’re “just doing repairs”?

It depends on your state and the scope of the repair. Many states have a project value threshold — commonly $500 to $1,000 — below which a general contractor license is not required. However, any work involving electrical, plumbing, mechanical, or structural systems almost always requires a trade license regardless of dollar amount. Verify your state’s specific threshold through your local building department before assuming small projects are exempt.

What if the contractor says their subcontractors carry the insurance?

This is a legitimate arrangement — general contractors commonly use licensed, insured subcontractors for trade-specific work. However, the general contractor should still carry their own general liability policy, and you have every right to request COIs for any major subcontractors working on your project. A professionally run GC operation maintains a current COI file for every subcontractor on their roster and can provide these documents on request without delay.

Is a handyman required to be licensed and insured?

Handyman licensing requirements vary widely by state and by the nature of the work performed. Many states exempt handyman work below a certain project value from licensing requirements, but this exemption typically does not cover any trade work — a handyman who replaces a light fixture or repairs plumbing may be legally required to hold the relevant trade license. Even when licensing isn’t required, insurance still protects you — a handyman working in your home without liability insurance exposes you to the same property damage and injury liability risks as any other uninsured contractor.

How current does a contractor’s insurance certificate need to be?

At a minimum, the certificate should show that the policy is active on the day you are reviewing it, and that the policy expiration extends beyond your project’s planned completion date. Certificates issued more than 60 to 90 days ago should be refreshed — ask the contractor to have their agent issue an updated certificate. Insurance policies can be cancelled mid-term for non-payment, so a certificate that was accurate three months ago may no longer reflect the current policy status.

Does hiring through a platform like Angi or HomeAdvisor protect me if a contractor isn’t insured?

These platforms perform some level of background screening and may offer limited protection programs — but their terms of service typically place significant limitations on their liability, and their screening processes are not infallible. Some platforms verify that a contractor was insured at the time of onboarding without confirming that coverage is still active at the time of your project. Verify the contractor’s credentials independently using the steps in this guide regardless of how you found them — platform vetting is a supplement to your verification, not a substitute for it.

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