To hold a Minnesota residential contractor or remodeler license, you need general liability insurance and you must show workers compensation compliance with every application and renewal. Minnesota does not issue a single statewide general contractor license for commercial work, but the Department of Labor and Industry licenses residential building contractors and remodelers, and that license comes with insurance strings attached. If you have employees, workers comp is one of them.
Who this is for: Minnesota contractors getting or renewing a residential building contractor or remodeler license, and anyone contracting directly with homeowners.
The short version
- Minnesota licenses residential building contractors and remodelers through the Department of Labor and Industry.
- A licensed contractor must carry general liability insurance, with a minimum of 300,000 dollars for any single claim (the 'per occurrence' limit) under the licensing standards.
- Every license application and renewal requires a certificate of compliance with Minnesota workers comp laws.
- If you have employees, you need workers comp; a contractor with no employees and no non-exempt workers can certify that none is required.
- Licensing agencies must hold up the license until you show workers comp compliance.
What the license actually requires
The residential license ties together a few coverages. You must carry general liability insurance to protect against property damage and injury claims, at least 300,000 dollars per occurrence under the state licensing standards. You must also show workers comp compliance: with each application and renewal you file a certificate of compliance with Minnesota workers comp laws, and by statute the licensing agency must withhold your license until you do. If you have employees, that means an active policy; if you truly have no employees and no non-exempt workers, you can certify that no coverage is required.
| Requirement | What Minnesota expects |
|---|---|
| License type | Residential building contractor or remodeler, through the Department of Labor and Industry |
| General liability | At least 300,000 dollars per occurrence under the licensing standards |
| Workers comp compliance | A certificate of compliance with Minnesota workers comp laws at each application and renewal |
| No-employee contractor | May certify that no workers comp is required, if truly no non-exempt workers |
| License hold | The agency must withhold the license until compliance is shown |
Where workers comp fits in
Workers comp is the requirement that trips up growing contractors. The day you hire your first employee, you need a policy, and your next license renewal will ask you to prove it. Even before you have employees, a subcontractor who is really an employee under Minnesota's strict construction test, the 14-factor test, can pull you into the coverage requirement. And because a general contractor can be made to pay for an uninsured sub's injured workers, collecting proof of coverage from every sub protects both your job and your license.
Getting the classifications right
Contractor policies are priced on the category your work falls into for pricing, and construction categories carry some of the highest rates, so getting them right matters. Splitting your payroll accurately, and keeping proof of coverage from your subs so their payroll is not added to yours at audit, keeps the price fair. We set contractors up with the liability limits the license requires and the workers comp proof the renewal needs, in one place.
A Minnesota contractor example
Illustrative, not a quote. A Plymouth remodeler gets a residential building contractor license as a one-person business and certifies that no workers comp is required because he has no employees. A year later he hires two carpenters, which means he now needs a workers comp policy, and his renewal will ask for the certificate of compliance. We put the policy in place, set his general liability at the limit the license requires, and make sure his subs' proof of coverage is on file so their pay is not added to his at audit. See our workers comp for contractors page.
Real questions Minnesota owners ask
What insurance do I need for a Minnesota contractor license?
A residential building contractor or remodeler license requires general liability insurance, at least 300,000 dollars per occurrence, and proof of workers comp compliance with every application and renewal.
Does Minnesota have a statewide general contractor license?
Not for commercial work. Minnesota does not issue a single statewide general contractor license, but it licenses residential building contractors and remodelers through the Department of Labor and Industry.
Do I need workers comp to get the license?
You must show workers comp compliance. If you have employees, that means an active policy. If you truly have no employees and no non-exempt workers, you can certify that no coverage is required.
How much general liability does the license require?
Under the state licensing standards, a licensed residential contractor must carry general liability of at least 300,000 dollars per occurrence. Confirm the current figure when you apply.
What is the certificate of compliance for?
It is how you show the state you meet the workers comp requirement. Minnesota requires a certificate of compliance with its workers comp laws at each license application and renewal, and the agency holds the license until you provide it.
Do my subcontractors affect my license insurance?
They can. A sub who is really an employee under Minnesota's 14-factor construction test can trigger the coverage requirement, and an uninsured sub's injury can fall on you, so collect proof of coverage from every sub.
What happens to my license if I let coverage lapse?
You may not be able to renew. The licensing agency must withhold the license until you show workers comp compliance, so a lapse can stall your renewal and your ability to work.
Why Minnesota owners choose Morrow
- We shop the right market for you. In Minnesota you buy workers' comp on the open, competitive market from any private insurer licensed in the state, because there is no state fund, and if no carrier will take you the assigned-risk plan (MWCARP) is the guaranteed backstop, so we can shop your rate freely and still have a fallback for hard-to-place work.
- We catch pricing mistakes. Your price depends heavily on the category your work falls into for pricing (the class code). Put people in the wrong category and you overpay for years. We review your payroll and classifications before you buy.
- Proof of coverage, fast. Need a certificate (proof of coverage) for a general contractor or a landlord before Monday? We turn those around the same business day for most carriers.
- We help lower the score that drives your price. Insurers give you a score based on your past claims that raises or lowers your cost (the experience modification rate). We review it each year, flag errors, and connect you with return-to-work and safety resources that bring it down.
- Real people when a claim happens. When someone gets hurt, we stay involved through the life of the claim, not just at renewal.
Related Minnesota guides
Every Minnesota business is set up a little differently. These companion guides answer the same question for other situations, plus the national explainers behind the terms used here.
- Business insurance in Minnesota (start here)
- Workers comp: the owner's overview
- I own an LLC: do I need workers comp?
- I'm a sole proprietor: do I need workers comp?
- I own a corporation (C-corp or S-corp): do I need it?
- We're a partnership: do we need workers comp?
- We're a nonprofit: do we need workers comp?
- My workers are 1099: do I still need it?
- Only part-time or seasonal staff: do I need it?
- I only employ family: do I need workers comp?
- Remote or out-of-state staff: do I need coverage?
- What happens if I don't carry workers comp?
- How much does workers comp cost?
- How do I get workers comp (even if turned down)?
- Workers compensation insurance, explained
- What workers comp costs (national guide)
- Do I need workers comp for 1099 contractors?
- Glossary: workers comp class code
- Minnesota contractor workers comp
This guide is general information, not legal advice. Minnesota rules and penalty amounts can change, so verify current requirements with the Minnesota Department of Labor and Industry or a licensed advisor before you rely on them. Last updated: July 2026.