Which Business and Professions Code section establishes the requirement for contractors to maintain workers' compensation insurance?
Correct Answer
C) Section 7125
B&P Code Section 7125 requires contractors to maintain workers' compensation insurance coverage.
Why This Is the Correct Answer
B&P Code Section 7125 is the specific statutory provision requiring contractors to maintain workers' compensation insurance as a condition of licensure. CSLB enforces this requirement and contractors must certify their workers' compensation status (or exemption) when applying for or renewing a license.
Why the Other Options Are Wrong
Option A: Section 7045
Section 7045 relates to CSLB's general authority to investigate and take action regarding unlicensed contractors — not workers' compensation requirements specifically.
Option B: Section 7031.5
Section 7031.5 addresses the requirement for contractors to include their license number in advertising. It has nothing to do with workers' compensation insurance.
Option D: Section 7125.2
Section 7125.2 is related to workers' compensation but addresses specific circumstances around license suspension when a contractor fails to maintain required coverage — it's the enforcement/consequence section, while 7125 is the foundational requirement section.
Memory Technique
Associate 7125 with 'workers' comp' by thinking: '7-1-2-5 = seven digits for a W-C (workers' comp) claim.' Or remember: 7125 is the base requirement; anything with a decimal (.2) is a follow-on enforcement rule.
More California Questions
A Class C-10 electrical contractor has annual gross receipts of $3.2 million. What is the required bond amount under current California law?
Under B&P Code Section 7125.4, what is the fee for initial Home Improvement Salesperson registration?
According to B&P Code Section 7125, what is the maximum penalty the CSLB can impose for contracting without a license?
A home improvement contract for $8,500 requires a 3-day right to cancel notice. The contract is signed on Tuesday at 2 PM. When does the cancellation period expire?
A contractor employs 15 workers across multiple job sites. The total annual payroll is $850,000 with a workers' comp rate of 4.1%. If they self-insure with a deposit requirement of 125% of estimated annual premium, what deposit is required?
A C-10 electrical contractor wants to perform plumbing work valued at $8,000 as part of a larger electrical project. Is this permissible under CSLB regulations?
A homeowner discovers that an unlicensed contractor performed $25,000 worth of work on their property. Under B&P Code Section 7031, what remedy is available to the homeowner?
A Class B general building contractor wants to perform electrical work valued at $750. According to the B&P Code, this contractor:
A contractor's qualifying individual leaves the company. How many days does the contractor have to replace them before the license becomes invalid?
According to B&P Code Section 7031, what happens to a contractor's right to payment if they perform work while unlicensed?
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A contractor receives a citation with a $2,500 penalty for a first-time unlicensed activity violation. They want to contest it. According to B&P Code Section 7099.2, what is the deadline to request a hearing?
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