Business & LicensingQuestion 1387 of 1605
California authorizes limited liability companies (LLCs) to hold contractor's licenses. What special financial security must a licensed LLC carry in addition to the standard bond?
a.A $1 million surety only
b.A separate LLC employee/worker bond and liability insurance in specified amounts
c.No additional security
d.A cash deposit of $100,000 with the county
Explanation
Under B&P Code section 7071.19, a licensed LLC must maintain liability insurance and a separate LLC employee/worker bond ($100,000) to protect its employees, in addition to the standard $25,000 contractor's bond required of all licensees.
Law Reference: B&P Code §7071.19Practice all 1605 questions free — no signup required.
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Sen Lin, PrepPass Founder · Verified against California CSLB Contractor License Law & Business Exam · How we review
Reviewed by Abraham Chen — Licensed California General Contractor (CSLB License #1101856 — verify)