Due to the passage of Senate Bill 392, California contractors can now hold a license as a Limited Liability Company. The CSLB will begin processing LLC license applications by January 1, 2012. This is big news for contractors who wish to protect their personal assets. Under an LLC, members are typically not personally responsible for the business debts and liabilities of the LLC.
There are some additional insurance and bonding requirements for LLC licenses. LLCs will be required to file a $100,000 surety bond in addition to the standard $12,500 bond already required for all licenses. Additionally, LLCs will be required to carry a general liability policy with a $1,000,000 Aggregate Limit. The required limit of liability increases for LLCs with more than five members, but not to exceed $5,000,000.
If you are a contractor forming an LLC and need help or advice on your insurance requirements, contact the experts at Red Hot Insurance.net. We can help you find the lowest price policy to satisfy your legal requirements. Additionally, we can provide a full risk analysis of your contracting business. We’ll give you the tools to make the right decisions about your insurance.