If you’re using a Responsible Managing Officer (RMO) to qualify a California contractor license, you may be wondering whether the RMO must provide their Social Security Number (SSN) to obtain the required contractor bond.
The answer is: not always.
The key is understanding the difference between what the California Contractors State License Board (CSLB) requires and what a surety company requires to issue a bond.
Quick Answer
An RMO may need to provide an SSN or other required identification to the CSLB as part of the licensing process, but that does not necessarily mean the RMO must provide their SSN to the bond company.
Some surety companies may issue the $25,000 Contractor License Bond using the information of another owner or principal of the business.
However, the answer can change if the RMO needs a separate $25,000 Bond of Qualifying Individual (BQI).
One of the first questions to ask is:
Does the RMO own at least 10% of the company?
Does an RMO Need an SSN for the Contractor License Bond?
Not necessarily.
California contractors are generally required to maintain a $25,000 Contractor License Bond.
When applying for the bond, the surety company determines what information it needs to underwrite and issue the bond.
Some surety companies may be able to issue the Contractor License Bond using the personal information of another owner, officer, member, or principal without requiring the RMO’s SSN.
For example, a corporation may have:
- An owner or corporate officer who provides their SSN and information to the surety company
- A separate RMO who qualifies the contractor license
Depending on the surety company’s underwriting guidelines, the bond may be issued without requiring the RMO’s SSN.
This varies by surety company.
One bond company requiring the RMO’s SSN does not necessarily mean every surety company will require it.
Does the RMO Own at Least 10% of the Company?
This is important because California may require a separate $25,000 bond for the qualifying individual, called a Bond of Qualifying Individual (BQI).
For corporate and LLC licenses, a qualifying individual who owns 10% or more of the voting stock or equity may qualify for an exemption from the BQI requirement by submitting the appropriate certification to the CSLB.
If the RMO Owns 10% or More
The RMO may qualify for an exemption from the separate $25,000 Bond of Qualifying Individual.
The company would still need its regular Contractor License Bond and any other bonds required for its business structure.
If the RMO Owns Less Than 10%
A separate $25,000 Bond of Qualifying Individual may be required.
Because this bond specifically relates to the qualifying individual, the surety may require additional information from the RMO to issue the bond.
What California Contractor Bonds Might Be Required?
Here is a simple overview:
| Bond | Amount | When It May Be Required |
|---|---|---|
| Contractor License Bond | $25,000 | Generally required for California contractor licenses |
| Bond of Qualifying Individual (BQI) | $25,000 | May be required for an RMO or other qualifying individual, depending on the license and ownership structure |
| LLC Employee/Worker Bond | $100,000 | Required for California contractor LLCs |
An LLC may therefore have additional bonding requirements beyond the standard $25,000 Contractor License Bond.
A Simple RMO Example
John owns ABC Construction, Inc., but Mike is the RMO who qualifies the contractor license.
John is willing to provide his SSN and personal information to the bond company, but Mike does not want to provide his SSN to the surety.
Can ABC Construction still get bonded?
Possibly.
Some surety companies may be able to issue the Contractor License Bond using John’s information.
However, Mike’s ownership percentage also matters. If Mike owns less than 10% of the company, a separate Bond of Qualifying Individual may be required, and the surety could require additional information from Mike for that bond.
This is why the answer depends on both the CSLB bond requirements and the underwriting requirements of the surety company.
What Should You Do If Your RMO Doesn’t Want to Provide an SSN?
Don’t automatically assume the contractor cannot get bonded.
First determine:
- What type of business entity is being licensed?
- Who owns the company?
- What percentage does the RMO own?
- Is a Bond of Qualifying Individual required?
- Is the company an LLC?
- Which individuals does the surety company require for underwriting?
In some situations, another owner or principal may be able to provide the information needed for the Contractor License Bond.
If a particular surety requires information from the RMO, there may be other surety companies with different underwriting requirements.
Frequently Asked Questions
Does every person on a California contractor license have to provide an SSN to the bond company?
Not necessarily. Surety companies establish their own underwriting requirements. Some may be able to issue a Contractor License Bond using the information of one owner or principal.
Does a California RMO need a Bond of Qualifying Individual?
It depends on the license and ownership structure. For a corporation or LLC, an RMO or other qualifying individual who owns less than 10% may be required to maintain a separate $25,000 Bond of Qualifying Individual.
What if the RMO owns 10% or more of the company?
A qualifying individual who owns at least 10% of the voting stock or equity may qualify for an exemption from the Bond of Qualifying Individual requirement. The appropriate certification must be submitted to the CSLB.
How much is a California Contractor License Bond?
The California Contractor License Bond is currently $25,000.
The $25,000 is the bond amount—not what the contractor pays for the bond. The actual premium depends on the surety company and underwriting.
Does a California contractor LLC need another bond?
Yes. California contractor LLCs are generally required to maintain a $100,000 LLC Employee/Worker Bond in addition to the $25,000 Contractor License Bond.
A Bond of Qualifying Individual may also be required depending on the qualifier and ownership structure.
Need Help With Your Contractor Bond?
If you’re setting up a California contractor license with an RMO—or you’re simply not sure which bonds are required—The Contractors Resource Center can help.
We can review your business and ownership structure, help determine which contractor license bonds you need, and explore bonding options available for your situation.
Get a Contractor Bond Quote
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Have questions before requesting a quote? Contact me directly.
Kevin Leipsic
The Contractors Resource Center
Phone: 530-320-3617
Email: kevin@thecontractorsresourcecenter.com
I’m happy to help you understand the bonding requirements before you purchase a bond.
The Contractors Resource Center
Helping Contractors Start, Grow & Manage a Successful Construction Business.
This article is provided for general educational purposes and is not legal advice. CSLB requirements and individual surety underwriting guidelines can change. Always verify current requirements for your specific situation.