California Contractor Insurance

California SB 216 Workers’ Compensation Rules for Contractors: 2026 Update

SB 216, as delayed by SB 1455, requires workers' comp on every active California contractor license from 1/1/2028. What a ghost policy is and what to do now.

Quick answer: SB 216, as delayed by SB 1455, requires every active California contractor license to carry workers' comp starting January 1, 2028, except joint ventures with no employees. A sole owner with no employees will meet the rule with a workers' comp policy often called a ghost policy. C-8, C-20, C-22, C-39 and C-61/D-49 licenses can't be exempt now. 113,190 of 226,463 licenses are still filed exempt (CSLB data, September 2026).

What changes on January 1, 2028

  • Starting January 1, 2028 (SB 216, as delayed by SB 1455), every active California contractor license must carry workers' comp, except joint ventures with no employees. Until then, C-8, C-20, C-22, C-39 and C-61/D-49 licenses must already carry it, and every other license needs it as soon as it has an employee.
  • The CSLB workers' comp exemption certificate goes away for everyone except joint ventures with no employees
  • A license with no workers' comp policy on file will be suspended, the same way it is for licenses that must carry it today

How many contractors are affected

License group (CSLB, September 2026)Active licensesFiled exempt
B General Building98,10256,038 (57%)
C-10 Electrical26,54313,388 (50%)
C-36 Plumbing16,5918,453 (51%)
C-33 Painting14,6577,725 (53%)
A General Engineering13,9544,703 (34%)
C-20 HVAC10,9800 (already required)
C-39 Roofing5,3390 (already required)

Note: Source: CSLB master license file, September 2026, licenses in good standing. A license can hold more than one classification, so rows overlap.

What a ghost policy is

A ghost policy is a workers' comp policy written for a business that has no employees, usually a sole owner. It covers the contractor's obligation to show a policy on file with CSLB and responds if a worker turns out to be an employee. Carriers rate it on a minimum payroll, so the premium is small compared with a policy for a crew. Some carriers will not write a true zero-payroll policy and require a nominal payroll.

Who must act first

  • Sole owners and partnerships filed exempt today: you will need a policy before 2028 to keep the license active
  • Anyone who hires even one employee: you need workers' comp at that moment, with or without a 2028 rule
  • Licenses that already cannot be exempt (C-8, C-20, C-22, C-39, C-61/D-49): no change, keep the policy continuous
  • Joint ventures with no employees: still exempt

What to do before 2028

  • Check your CSLB record: the workers' comp line shows 'Exempt' or a carrier and policy
  • If you are exempt, get a quote early so the policy is in place well before the deadline
  • If you use 1099 helpers, confirm they are properly classified. Misclassified workers can turn into employees for workers' comp
  • Ask your broker which markets write ghost policies for your class and what minimum payroll they require

Get a ghost policy quote

Asena quotes owner-only workers' comp for California contractors and checks which carriers accept your class code and state. Call (858) 925-9555 or request a review online — only your name, phone and email are required; we collect project details by phone. Asena Capital Insurance Services, CA License #6008596.

Frequently asked questions

Do sole proprietor contractors need workers' comp in California?

Not today unless you have an employee or hold a license that cannot be exempt (C-8, C-20, C-22, C-39 and C-61/D-49). From January 1, 2028, every active license needs workers' comp, except joint ventures with no employees.

What is a ghost policy?

A workers' comp policy for a business with no employees, used to keep a contractor license in compliance. The premium is based on a small minimum payroll.

When does SB 216 take effect?

January 1, 2028, after SB 1455 delayed the original start date.

How do I know if my license is filed exempt?

Look up your license on the CSLB website. The workers' comp section says 'Exempt' or shows an insurance company and policy number.

Sources

Related pages

Request a coverage review