Who this applies to
New Jersey has no statewide license or bond for general or commercial contractors. Its requirement attaches instead to two registrations kept by the Division of Consumer Affairs, one for home improvement contractor businesses (HICBs) and one for home elevation contractor businesses (HECBs). Every HICB and HECB obtaining, renewing or reinstating a registration must maintain what the law calls "additional security" [1]. The amount follows the size of the work, and each tier is stated two ways, by the value of a single contract or by contract volume over the previous 12 months [1]:
- $50,000 for services under a contract valued at more than $120,000, or for contracts valued at a minimum of $750,000 in the previous 12 months [1].
- $25,000 for a contract valued between $10,000 and $120,000, or contracts between $150,000 and $750,000 in the previous 12 months [1].
- $10,000 for a contract valued at less than $10,000, or contracts valued at less than $150,000 in the previous 12 months [1].
Where the single-contract measure and the annual measure point to different tiers, the Division of Consumer Affairs is the authority to confirm which one governs.
What the rule says
Under N.J.S.A. 56:8-142 the security is something each registered business must maintain [1], and a bond is only one way to provide it. The law accepts a compliance bond, an irrevocable letter of credit, or securities, money or other security, provided the Division finds the chosen form acceptable. The tier fixes the amount; the business picks the form from that list.
How to comply
With the form chosen and the amount matched to the tier above, two insurance requirements sit alongside the security in the registration file:
- commercial general liability insurance of at least $500,000 per occurrence for an HICB, or $1,000,000 per occurrence for an HECB [1];
- workers' compensation insurance, unless the business is exempt under N.J.S.A. 34:15-1 et seq. [1]
The Division's home improvement pages are at njconsumeraffairs.gov/hic, and its notice in the Sources sets out the tiers in full.
What changed recently
P.L. 2023, c. 237, signed on January 8, 2024, amended the Contractors' Business Registration Act (N.J.S.A. 56:8-136 et seq.) and created a new State Board of Home Improvement and Home Elevation Contractors [1]. The security requirement is enforced through registration renewal: existing registrations expired on March 31, 2025, and renewals from that cycle required the security [1]. The same amendment added the workers' compensation requirement and kept the liability insurance minimums that were already in force.
Related
- Contractor license bond cost calculator, for businesses that choose the bond form of the security.
- All states' bond requirements, New Jersey included.