The Dos and Dont’s of Advertising Your Contractor License, Bonds and Insurance

You’ve probably heard it before: if you have a contractor license, bonds, and insurance coverage, let people know about it! In a digital age where you can put up a website and promote your business on a dozen different social media accounts all in one day, you are missing out if you’re not advertising your business.

If you want to use your status as a licensed and bonded contractor to your advantage to get more work, there are some right (and wrong) ways to proceed.

Here are some Do’s and Don’ts to help you earn client trust with the help of your contractor license, insurance, and bonds.

Do: Advertise Your Contractor License Status

Getting your contractor license took time, effort, and an investment on your part. Now you get to reap the benefits. Your potential clients may not fully understand what went into your license process, but they do know that it’s better to work with a licensed contractor than an unlicensed one. If you have business cards, a website, social media accounts for your business, paper collateral, contracts, or any other advertising materials, be sure they include your license status and license number.

Don’t: Advertise Your Bond Status

You may not realize it, but advertising your bond status could be a big misstep. In California, for example, it is forbidden by law to advertise the fact that you are bonded (B&P Section 7071.13). So check your business cards, website copy, social media accounts and anything else that could be considered an advertisement for your business carefully.

Advertising your license status is a do, but specifically advertising your bond status is a big don’t -- at least if you’re licensed in CA.

But just because you can’t throw the word “bonded” on a business card doesn’t mean your clients can’t understand the benefit of your bonded status. It’s simply up to you to have that conversation with them!

Do: Advertise Your Contractor Insurance Coverage

Want to really put a prospective client’s mind at ease? Let them know that you have adequate contractor insurance in place. When you have contractor insurance policies such as general liability, commercial auto, and builders risk, you have a safety net against accidents and unintentional incidents that could potentially stop, stall, slow, or even destroy a project. Be sure your advertising efforts include your status as an insured contractor.

Don’t: Expect Clients to Know What Your Contractor Bonds Cover

Your contractor bonds are put in place to protect the obligees who require them. But a layperson may not understand what a bond is or what it means that you’re bonded. So don’t expect potential clients to know that you had to get a license bond in order to get your license, what your license bond covers, or what happens if a claim is filed against your bond.

You can take the time to have a conversation with a client and offer to explain any aspect of your bond coverage that they may not understand. A license bond is a guarantee that you will do your work honestly and according to the contractor license code.

When you put it simply, it is easy for a potential client to see the benefit of choosing a contractor who is licensed, bonded, and insured.

Do: Include Your License Number on Ads

According to the California State License Board, your contractor license number must be included in anything that is considered advertising for your business. That includes business cards, website content, directories, as well as clothing or items that have been branded with your business name and logo. Be sure that anything that promotes your business or services includes your contractor license number.

Don’t: Advertise Illegally

Know what you can, and can’t, do when advertising your contractor business in your state. If you live in CA, here are some tips straight from the CSLB to avoid advertising legally:

  • Don’t advertise work you’re not licensed to perform.
  • Don’t use false or misleading advertising.
  • Don’t advertise a price or service you don’t intend to honor.
  • Don’t advertise about bonding.
  • Do include your license number on all advertisements.

Do: Ask for Reviews and Testimonials

There is one more way you can earn a potential client’s trust when advertising your business: include testimonials and reviews from former clients! A review is one of the most powerful tools you have for earning client trust. In a recent survey, 88% of people used reviews to determine the quality of a local business, and said they trusted online reviews as much as they’d trust a personal recommendation. Be sure to ask your happy clients for a review for your website, on a social media account like Facebook, or on an online directory.

Check with the license board in your state to make sure you’re adhering to your local rules and regulations for advertising your business. Wherever you do business, however, don’t miss out on a golden opportunity to get more clients and earn client trust by letting people know about your license, bonds, and insurance coverage.