How to Get a Contractor License in Washington: A Complete Step-by-Step Guide
If you're planning to start a contracting business in Washington, one of the first things you need to understand is that Washington generally refers to this credential as contractor registration, rather than a traditional contractor license.
Washington requires construction contractors to register with the Washington State Department of Labor & Industries (L&I) before they can legally bid, advertise, or perform construction work. Contractors must also maintain the required surety bond and liability insurance.
Whether you're starting a general contracting company, remodeling business, roofing company, painting business, landscaping company, or another construction-related business, getting your registration requirements right from the beginning can help you avoid delays, penalties, and compliance problems.
Here's a step-by-step look at how to get registered as a contractor in Washington.
Step 1: Determine What Type of Contractor You Will Be
Washington has two primary categories of construction contractors:
General contractors
Specialty contractors
A general contractor can perform most types of construction work and can hire subcontractors in multiple specialties.
A specialty contractor is limited to the specific specialty for which the contractor is registered and generally cannot hire subcontractors. Washington recognizes dozens of specialty classifications, including roofing, painting, HVAC, tree removal, and others.
It's important to choose the appropriate registration category before completing your application.
Certain trades, including electrical and plumbing work, have additional licensing requirements beyond general contractor registration.
Step 2: Choose Your Business Structure
Before registering as a contractor, you'll need to establish your business.
Your options may include:
Sole proprietorship
Partnership
LLC
Corporation
Other qualifying business structures
If you're forming an LLC or corporation, you'll generally need to register with the Washington Secretary of State.
You'll also need to obtain a Washington Unified Business Identifier (UBI) through the state's business licensing process. L&I requires the business registration and tax account information before contractor registration can be completed.
Your legal business name is especially important because your contractor registration, surety bond, and liability insurance documents need to match the business name on file.
Step 3: Obtain Your Washington Contractor Bond
One of the most important requirements is the Washington contractor surety bond.
As of the current requirements, the bond amounts are:
Contractor Type | Required Bond |
General Contractor | $30,000 |
Specialty Contractor | $15,000 |
These amounts increased beginning July 1, 2024.
The bond is required to protect the public and provide financial recourse in certain situations involving a contractor's obligations.
A contractor surety bond is not insurance for the contractor. Instead, it provides a financial guarantee backed by a surety company.
If a valid claim is paid under the bond, the contractor can ultimately be responsible for reimbursing the surety.
Can You Use Savings Instead of a Bond?
Washington does allow an alternative called an Assignment of Savings Account.
However, most contractors choose a surety bond because it can be more practical than tying up the full required amount of money in a dedicated account.
Step 4: Get General Liability Insurance
Washington also requires construction contractors to maintain liability insurance.
The minimum coverage is:
$200,000 public liability
$50,000 property damage
Or a $250,000 combined single limit policy.
Your insurance documentation must meet L&I's requirements, and L&I must be listed as the certificate holder.
It's important to understand that the required contractor bond and general liability insurance serve different purposes.
Protects the public against certain contractor obligations and violations.
Helps protect the contractor's business from covered claims involving bodily injury, property damage, and other covered liabilities.
For many contractors, additional insurance may also make sense depending on the type of work they perform.
Step 5: Complete the Contractor Registration Application
Once your business, surety bond, and insurance are in place, you'll need to complete the Application for Contractor Registration with Washington L&I.
The application requires information about your business and its principals.
Certain owners, members, partners, or corporate officers may need to complete the required affidavit and provide identifying information. L&I also checks for certain outstanding judgments and debts that can affect registration.
Your application needs to be completed accurately because errors involving your business name, surety bond, liability insurance, or registration information can delay the process.
Step 6: Submit Your Application and Pay the Registration Fee
Washington L&I currently lists a $150.20 contractor registration fee on its contractor registration page.
You can register through available L&I processes, including submitting your completed application to L&I.
When submitting your application, you'll generally need:
Contractor registration application
Business information/UBI
Required signatures
Registration fee
L&I notes that mailed applications currently take approximately 3–4 weeks after receipt to process and activate, although processing times can change.
Step 7: Make Sure Your Bond and Insurance Match Your Business Name
This is an easy detail to overlook.
The name on your:
Contractor registration
needs to match the business information on file with the state.
A mismatch can create unnecessary delays.
Before submitting your application, carefully compare the legal business name across all documents.
Step 8: Understand Washington's Additional Requirements
Getting registered doesn't mean your compliance responsibilities end.
Depending on your business and the work you perform, you may have additional requirements involving:
Workers' compensation
Employees
Independent contractors
Electrical work
Plumbing
Lead-based paint
Pesticide application
Safety requirements
Public works projects
Prevailing wage
Local requirements
For example, Washington generally requires workers' compensation coverage for workers unless a specific exemption applies. Independent contractors in construction must also meet specific requirements to be treated as exempt from workers' compensation coverage.
Certain public works projects have additional requirements involving registration, industrial insurance, prevailing wage, payroll records, and training.
How Much Does It Cost to Become a Contractor in Washington?
Your total startup cost will depend on your business structure, liability insurance, surety bond premium, registration fee, and other business expenses.
At minimum, you should budget for:
Contractor registration fee: $150.20
Contractor bond: Premium varies based on the surety company's underwriting requirements.
General liability insurance: Cost varies based on your business, classification, payroll, revenue, claims history, and other factors.
You'll also have normal business startup costs such as entity formation, licensing, equipment, vehicles, marketing, and accounting.
How Much Does a Washington Contractor Bond Cost?
The $30,000 or $15,000 bond amount is not the same thing as the price you pay for the bond.
You don't necessarily pay $30,000 for a $30,000 surety bond.
Instead, you pay a premium to the surety company. The actual premium depends on factors such as:
Contractor classification
Credit
Business experience
Financial strength
Surety underwriting
Contractors with strong credit and financial profiles may qualify for competitive rates, while contractors with credit challenges may pay more.
This is one reason it's worth comparing contractor bond providers before purchasing your bond.
What Happens If Your Contractor Bond or Insurance Expires?
This is extremely important.
Washington can suspend a contractor registration when required registration conditions aren't met, including situations where the required surety bond or liability insurance expires or is canceled.
That means contractors shouldn't wait until the last minute to renew their bond or insurance.
If your registration becomes suspended, you may need to correct the problem and provide proof of the new surety bond or insurance before the registration can be reinstated.
How Long Does Washington Contractor Registration Last?
Washington contractor registrations must be renewed when due.
Before renewing, contractors should verify that their:
Registration is active
Business information is accurate
The current L&I renewal fee listed on its contractor registration page is $150.20.
If your business name, structure, ownership, or specialty changes, you may have additional requirements rather than simply completing a standard renewal.
Common Mistakes Washington Contractors Should Avoid
Getting registered isn't necessarily complicated, but small mistakes can create major headaches.
1. Using the Wrong Business Name
Your surety bond, liabiltiy insurance, and registration should use the correct business name.
2. Forgetting the Bond
Washington requires construction contractors to maintain the appropriate surety bond or approved alternative.
3. Letting Insurance Lapse
An expired or canceled insurance policy can result in registration suspension.
4. Choosing the Wrong Specialty
Specialty contractors are restricted to the work covered by their specialty registration.
5. Assuming Every Trade Has the Same Requirements
Electrical and plumbing contractors, for example, have additional requirements beyond standard construction contractor registration.
6. Waiting Until the Last Minute
Surety bond and liability insurance problems can delay registration or renewal.
7. Ignoring Workers' Compensation Requirements
Calling someone an "independent contractor" doesn't automatically make them exempt from Washington workers' compensation requirements.
How All American Bonds and Insurance Can Help
Getting registered as a Washington contractor requires more than simply filling out an application.
You need the appropriate contractor bond and insurance in place, and getting those documents correct can make the registration process much smoother.
All American Bonds and Insurance helps contractors obtain the surety bonds and commercial insurance coverage they need to operate their businesses.
Whether you're starting a new contracting company or renewing an existing registration, our team can help you understand your bond requirements and find competitive options.
Need a Washington Contractor Bond or Contractor Insurance?
All American Bonds and Insurance Phone: 844-321-2663, Email: info@quickerbonds.com Website: www.QUICKERBONDS.com
Washington Contractor License FAQ
Do contractors need a license in Washington?
Washington generally requires construction contractors to register with L&I before bidding, advertising, or performing construction work. Some trades, such as electrical and plumbing, have additional licensing requirements.
How much is the Washington contractor bond?
The current bond requirement is $30,000 for general contractors and $15,000 for specialty contractors.
How much liability insurance does a Washington contractor need?
Contractors generally need either $200,000 public liability plus $50,000 property damage coverage, or a $250,000 combined single limit policy.
Can I get a Washington contractor bond with bad credit?
Potentially, yes. Bond approval and pricing depend on the surety company's underwriting requirements. Contractors with credit challenges may have fewer options or higher premiums.
Can I work without registering as a contractor?
Generally, no. Washington requires construction contractors to register before they can legally bid, advertise, or perform construction work. Working without registration can result in penalties and fines.
Can I use an alternative to a contractor bond?
Yes. Washington allows an approved Assignment of Savings Account as an alternative to the required surety bond.
Do Washington contractors need workers' compensation?
Generally, businesses must provide workers' compensation coverage for covered workers unless a specific exemption applies. Construction businesses have additional rules concerning independent contractors.
Final Thoughts
Starting a contracting business in Washington requires more than choosing a company name and finding customers. You need to establish the business properly, obtain the correct contractor bond and liability insurance, register with Washington L&I, and maintain your registration and compliance requirements.
The most important thing is to get your bond and insurance requirements right from the beginning.
If you're ready to start your Washington contracting business, All American Bonds and Insurance can help you get the contractor bond and insurance you need.
Call 844-321-2663 or visit www.QUICKERBONDS.com to get started.
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