Under SB 216, as delayed by SB 1455, nearly every California contractor license will require an active workers' compensation policy starting January 1, 2028, even if the contractor has no employees. Today, contractors with no employees can still file a certificate of exemption with the CSLB, except C-8 concrete, C-20 HVAC, C-22 asbestos abatement, C-39 roofing, and C-61/D-49 tree service contractors, who must already carry coverage. A lapse in coverage results in license suspension. Requirements can change, so confirm your status with the CSLB.
The Short Version
California is closing the door on the "no employees, no workers' comp" option for contractors. Starting January 1, 2028, nearly every CSLB license classification will need an active workers' compensation policy on file to stay active, whether or not you have a single employee.
That date used to be January 1, 2026. SB 1455 pushed it back two years. If you have seen articles telling you your license will not renew this year without a policy, check your classification before you panic, because for most license classes that is not yet true.
Who Already Has to Carry It Today
Five classifications cannot file a no-employee exemption right now. According to the CSLB, these contractors must carry workers' compensation regardless of whether they have employees:
- C-8 Concrete
- C-20 Warm-Air Heating, Ventilating and Air-Conditioning
- C-22 Asbestos Abatement
- C-39 Roofing
- C-61/D-49 Tree Service
You also cannot file an exemption if your license is qualified by a Responsible Managing Employee, or if you employ anyone in a way that falls under California workers' comp law.
What Changes on January 1, 2028
After that date, the certificate of exemption goes away for almost everyone. A sole owner running a painting, flooring, or handyman license alone will need a policy on file with the CSLB to keep the license active.
The practical effect is simple. A very large number of small contractors will be shopping for their first workers' comp policy in the same window. Carriers that write very small contractor accounts will get busy, and the contractors who wait until the last quarter will have the fewest options.
The Penalties Already Went Up
You do not have to wait until 2028 to feel this. SB 291, effective January 1, 2026, significantly increased the penalties for workers' compensation violations and directed the CSLB to build a new process for verifying exemption eligibility. In plain terms, the state is already checking exemptions more carefully.
If you filed an exemption years ago and have since hired a helper, even part time, even paid in cash, your exemption is likely invalid and you are exposed right now.
What Coverage Looks Like for a One-Person Shop
Workers' comp is priced per $100 of reportable payroll, by class code. For a business with no employees, the question is how the owner's own pay is treated, and that depends on your entity type:
- Sole proprietors are generally not covered by their own policy unless they elect to include themselves.
- Partners and LLC members have their own inclusion and exclusion rules.
- Corporate officers can often exclude themselves if they meet ownership requirements.
Carriers also apply a minimum premium, so there is a floor on what any policy costs. The cheapest compliant policy for a solo contractor is usually structured very differently from the policy a 10-person crew buys. This is where a broker who writes small contractor accounts saves real money.
Why Buying Before the Deadline Makes Sense
- Jobs already require it. Many general contractors, property managers, and public agencies require a workers' comp certificate from every subcontractor, regardless of state exemption rules.
- You avoid the 2027 rush. Underwriters will be flooded with first-time small accounts in late 2027.
- You build a track record. A clean year or two on a policy helps with future pricing and with your experience modification once you qualify for one.
- You are covered if you hire. The moment you bring someone on, even for one job, you need coverage. Having it in place removes the risk of an invalid exemption.
What to Do This Month
- Look up your license on the CSLB site and confirm what is on file: a policy or an exemption.
- If you hold C-8, C-20, C-22, C-39, or C-61/D-49 and have an exemption on file, call a broker today.
- If you have hired anyone since you filed your exemption, get coverage now.
- Everyone else: get a quote in the next few months so you know your real cost before 2028 pricing pressure hits.
Construction Pros writes workers' comp for California contractors of every size, including one-person shops. Get a free workers' comp quote or read more about California workers' compensation for contractors.
Frequently Asked Questions
Do I need workers' comp in California if I have no employees?
Until January 1, 2028, most license classes can still file a certificate of exemption with the CSLB if they truly have no employees. Five classifications cannot: C-8 concrete, C-20 HVAC, C-22 asbestos abatement, C-39 roofing, and C-61/D-49 tree service. Those contractors must carry a workers' comp policy regardless of headcount. Starting January 1, 2028, the exemption goes away for nearly every license class.
Wasn't the all-contractor requirement supposed to start in 2026?
Yes. SB 216 originally set January 1, 2026. SB 1455 moved it to January 1, 2028. A lot of online content still cites the 2026 date, so if you read that you need coverage now to renew, check which classification you hold before buying anything.
What happens if my workers' comp lapses?
The CSLB suspends the license. Any work performed while suspended is treated as unlicensed, which exposes you to discipline and makes it very hard to collect payment on that work. Separately, SB 291 raised the penalties for workers' comp violations starting in 2026.
How much does workers' comp cost for a one-person contracting business?
It depends on your class code, the payroll you report for yourself, and the carrier. Owners of some entity types can include or exclude themselves, and the rules differ for sole proprietors, partnerships, LLCs, and corporations. A policy with minimal reportable payroll can cost far less than most owners expect, but carriers apply minimum premiums. The only way to know is to quote your exact license class and entity type.
Should I buy now or wait until 2028?
If you are in one of the five mandatory classes, you need it now. If you are not, buying before the deadline gives you time to build loss history, compare carriers before demand spikes, and bid jobs that already require coverage. Many general contractors and property managers require a certificate of workers' comp from every sub regardless of what the state allows.