Michigan Builder Requirements: Education, Renewal & Exam Format
Beyond passing both exam parts, a Michigan builder must satisfy prelicensure and continuing education and understand the closed-book exam format. This chapter reviews the 60-hour requirement, the three-year renewal cycle, workers' compensation, and how the Business and Law exam is delivered.
Prelicensure and continuing education
A first-time applicant must complete 60 hours of board-approved prelicensure education before examination. At renewal, licensees must complete continuing-competency education during each three-year license cycle to keep the license active. These education requirements exist because the exams are closed book — the candidate is expected to know Michigan licensing law, contract rules, and construction standards from study rather than to look them up during the test.
Insurance and workers' compensation
A Michigan residential builder who has employees must carry workers' compensation coverage under the Worker's Disability Compensation Act; coverage is generally required once a private employer regularly employs workers (commonly stated as three or more, or one or more employed 35 or more hours per week for 13 weeks). Builders are also expected to carry general liability insurance appropriate to their work, and to account properly for owner funds. Candidates should verify current thresholds with LARA, but the exam tests the principle that a builder with a crew must be covered.
Closed-book, multiple-choice exam format
The Michigan Residential Builder Business and Law exam (Part 1) is a closed-book, multiple-choice test of 50 questions in 75 minutes, requiring 36 correct answers (72%) to pass. Its content mirrors the prelicensure curriculum: regulatory and statutory topics, insurance, bonds and liens, contracts, project management and administration, accounting and finance, business organization, personnel, and estimating. Because there is no reference material in the room, candidates should master the Michigan-specific rules — the $600 threshold, the no-suit rule for unlicensed builders, and the lien deadlines — from memory.