When selecting a home improvement contractor, it is essential that you choose someone with a state contractor license. Most states require home improvement contractors register with the state Office of Consumer Affairs. A contractor license offers consumers protection that is unavailable if you work with an unregistered home improvement contractor.

Who Needs a Home Improvement Contractor License?

Each state has different requirements as to which trades require a contractors licenses in order to operate. As a general rule of thumb, trades that are paid by the hour don’t require a contractor license, with some exceptions, including electricians and plumbers.

Home improvement contractors who bid on significant home improvement projects usually do require state contractor licenses. Again, which jobs require a contractor license differ depending on your state, but often include such home improvement projects as:

• Basement renovations
• Driveway replacement or construction
• Landscaping
• Patios and porches
• Swimming pool installation
• Roofing
• Terraces and fences
• Window replacement.

This list is by no means exhaustive. Contact your state Office of Consumer Affairs to check if your home improvement project requires a state contractor license. Home improvement contractors may also require a CSL, or construction supervisor license, if they perform services that affect the structure of a home. Some examples of such projects are:

• Demolition
• Masonry
• Roofing.

Benefits of Working with a State-Licensed Home Improvement Contractor

A state contractor license provides peace of mind and protection for the consumer. In many states, home improvement contractors must provide proof of adequate liability insurance and workers compensation in order to register with the state. Hiring a contractor without insurance can leave the homeowner liable for any injuries or damage incurred during the home improvement contract.

In the event that a dispute over the home improvement contract occurs, state contractor licenses offer definite advantages. A state licensed contractor agrees to abide by the state’s arbitration process, and pays into a Guaranty Fund to protect consumers. In the event of a dispute where the contractor refuses to return money, consumers can appeal to the Guaranty Fund, which may reimburse them for damages, court costs and attorney fees up to a set amount. No such protection exists if you hire a contractor without a state license.

Verifying a Home Improvement Contractor’s State Contractor License

Home improvement contractors registered with the state should have contractor’s licenses that they can produce on request. If you have any concerns that a home improvement contractor is not licensed, most Offices of Consumer Affairs websites include searchable databases of registered contractors, including information on how long the contractor has been registered and if the contractor’s license is current.

In addition, online contractor referral services also list which contractors are registered, to better help consumers choose between home improvements contractors.