If you're running a home remodeling business in Florida, here's what keeps most contractors up at night: insurance requirements. And not just any insurance—Florida has some of the strictest rules in the country when it comes to what coverage you need to keep your license active and your business legal. Miss even one requirement, and you could face fines, license suspension, or worse—personal liability if something goes wrong on a job.
The good news? Once you understand what's required, staying compliant isn't complicated. This guide breaks down exactly what insurance you need, what it costs, and how to avoid the common mistakes that trip up remodeling contractors in Florida.
Florida Licensing and Insurance Mandates
Let's start with the basics: if you're doing any structural work, plumbing, electrical, HVAC, or significant alterations in Florida, you need a license. That includes kitchen remodels, bathroom renovations, wall removals—pretty much anything beyond cosmetic updates like painting or flooring.
For most remodeling work, you'll need either a Building Contractor License (CBC) or a Residential Contractor License (CRC). The CBC covers commercial and residential projects up to three stories, while the CRC is limited to one-, two-, or three-family homes up to two habitable stories. To get licensed, you'll need to pass state exams, prove your experience or education, and—here's where insurance comes in—demonstrate financial responsibility.
Florida's Construction Industry Licensing Board doesn't mess around. They require you to submit a signed affidavit confirming you carry the required insurance every time you apply for or renew your license. And they randomly audit contractors by ZIP code to verify compliance, so this isn't something you can let lapse.
General Liability Insurance Requirements
Here's where things get specific. If you hold a general or building contractor license, Florida requires you to carry at least $300,000 in general liability coverage and $50,000 in property damage coverage. For specialty contractors—think residential or trade-specific licenses—the minimums drop to $100,000 liability and $25,000 property damage.
You can also opt for a combined single limit policy of $300,000 instead of maintaining separate coverage limits. This can sometimes be more cost-effective and simpler to manage.
But here's the catch: those are just the state minimums to keep your license active. In practice, most commercial clients and even many homeowners will require you to carry $1 million per occurrence with a $2 million aggregate before they'll sign a contract. Why? Because one serious accident—say, a worker falls through a roof or a fire damages a client's home—can easily exceed $300,000. Your clients know this, and they're not willing to risk it.
The average cost for remodeling contractors? Expect to pay between $970 and $1,200 annually for business insurance, which works out to about $81 to $97 per month. That typically includes general liability, though your actual cost will depend on your revenue, number of employees, claims history, and the specific types of work you do.
Workers' Compensation Requirements
This is where Florida gets really strict. If you're in the construction industry—and yes, home remodeling counts—you must carry workers' compensation insurance if you have even one employee. That's different from most other industries in Florida, which have a four-employee threshold.
Workers' comp covers medical treatment, disability benefits, and death benefits if an employee gets injured or killed on the job. Given the inherent risks in remodeling—power tools, ladders, demolition work, heavy materials—this coverage is essential. It protects your employees and shields you from potentially devastating lawsuits.
There are some exemption options. Corporate officers who own at least 10% of the company can apply for an exemption, and you can exempt up to three officers. The exemption costs $50 and must be renewed every two years. But here's the important part: if you exempt yourself as an owner but you have even one employee, you still need a workers' comp policy to cover that employee.
And if you hire subcontractors? You're responsible for making sure they have their own coverage. If a sub's employee gets hurt on your job site and that sub doesn't have insurance, you could be on the hook for the benefits. Always verify coverage before letting any sub start work.
Contractor Bonds and Financial Responsibility
Beyond insurance, Florida requires every licensed contractor to carry a bond. This isn't insurance for you—it's a financial guarantee to your clients that you'll comply with state regulations and honor your contracts. If you fail to do so, a client can make a claim against your bond.
The bond amount varies based on your license type and financial situation. If your credit score is below 660, you'll need to submit a larger bond or an irrevocable letter of credit. However, you can meet 50% of the bond requirement by completing a 14-hour financial responsibility course, which can save you money and help you better manage your business finances anyway.
How to Get Started and Stay Compliant
The first step is talking to an insurance agent who specializes in contractor coverage. Don't just grab the cheapest quote online—you need someone who understands Florida's requirements and can help you structure your policies correctly. Make sure your agent knows you're in home remodeling specifically, as rates and coverage needs differ from new construction.
When you're comparing policies, look beyond the premium. Check the coverage limits, deductibles, exclusions, and whether the policy includes completed operations coverage (which protects you from claims that arise after you finish a job). Ask about additional insureds—you'll often need to add clients or property owners to your policy for specific projects.
Set up calendar reminders for policy renewals and license renewals. The worst time to discover your insurance lapsed is when a client asks for a certificate of insurance or when you need to file a claim. Keep digital and physical copies of all your insurance documents, bonds, and exemption certificates in an organized system.
Finally, review your coverage annually. As your business grows, adds employees, or takes on larger projects, your insurance needs will change. What worked when you were a solo operation won't be adequate when you're running crews on multiple job sites. Stay ahead of it, and you'll avoid expensive gaps in coverage.
