Checking a contractor's license and insurance takes about ten minutes, and it's one of the highest-value things you can do before hiring. It helps screen out people who can't legally do the work. And if something goes wrong, it often decides whether you have any way to recover your money.
Why it matters
- Accountability. A licensing board can investigate complaints and discipline licensees. An unlicensed contractor has no board to answer to.
- Recovery options. Bonds and state recovery funds, where they exist, generally cover only licensed contractors.
- Insurance. If an uninsured worker is injured on your property, or damages your home, you could end up dealing with the cost.
- Permits. In many places, only a licensed contractor can pull the permit for plumbing, HVAC or electrical work. Unpermitted work can cause problems with insurance claims and when you sell.
Which trades are usually licensed
Licensing rules are set by states, and sometimes by cities and counties, so they vary. As a general guide:
- Plumbers: licensed in most states.
- HVAC contractors: licensed in most states, at the state or local level. Technicians who handle refrigerant must also hold EPA Section 608 certification.
- Pest control: pesticide applicators are licensed or certified in every state, usually through the state department of agriculture.
- Garage door and gutter work: often covered by a general or home improvement contractor license rather than a trade-specific one, depending on the state and the size of the job.
- Auto repair: a few states, including California, require repair shops to register with a state agency. Individual mechanics' ASE certifications are voluntary but a good sign.
How to check a license, step by step
- Ask for the license number. Legitimate contractors expect the question. In many states, the number must appear on estimates, contracts, vehicles or advertising.
- Find the right lookup. Search "[your state] contractor license lookup" or "[your state] plumbing license verification". Use the official state site, usually a .gov address, rather than a third-party directory.
- Confirm the details match. Check that the name on the license matches the business name on the quote, the license is active, and it covers the type of work being quoted.
- Look at disciplinary history. Many state lookups show complaints, citations or suspensions. One old complaint isn't disqualifying, but a pattern is.
How to check insurance
Ask for a certificate of insurance (COI). The two coverages that matter most are:
- General liability, which covers damage to your property caused by the contractor's work.
- Workers' compensation, which covers the contractor's employees if they're injured on your property. Requirements vary by state and business size.
The strongest way to verify is to ask the contractor's insurance agent to send the certificate directly to you. A certificate that comes from the agent is much harder to fake than a PDF forwarded by the contractor. Check that the policy dates cover your job and the named insured matches the business.
What "bonded" means
A contractor's license bond is a type of surety bond, often required for licensing, that can pay claims if the contractor violates licensing laws or fails to meet obligations. It's not insurance for you, and the amounts are often modest. Bond requirements, and whether a bond is useful to a homeowner, vary by state. "Licensed, bonded and insured" is a good sign, but verify each part rather than taking the phrase at face value.
Other quick checks
- A real business address. Look it up on a map. Companies that list only a phone number and a generic name are a known pattern in some home-service scams.
- Business registration. Your secretary of state's website lets you confirm the company legally exists.
- Reviews over time. Look for a consistent track record rather than a sudden burst of five-star reviews.
Red flags
- They avoid giving a license number, or give one that doesn't match their name
- They suggest you pull the permit yourself as the homeowner to save money. That can shift responsibility for code compliance onto you.
- They offer a big discount for cash and no paperwork
- They show up unannounced saying they "have materials left over from a job down the street"
Frequently asked questions
Is a handyman allowed to do plumbing or HVAC work?
It depends on your state and the size of the job. Many states allow unlicensed handymen to do only minor work under a dollar threshold, and many exclude licensed trades like plumbing, HVAC and electrical entirely. Check your state's rules before hiring for anything beyond minor repairs.
What if I already hired someone unlicensed?
If the work is done and fine, there may be nothing to do. If there's a problem, your options may be more limited. File a complaint with the licensing board anyway, since contracting without a license is itself a violation in many states. See our guide to what to do when a repair goes wrong.
How much should a licensed contractor charge?
Use our plumbing, HVAC and pest control calculators for typical ranges.