Do you want to get your Hawaii contractors license, but you aren’t sure how? Whether you’re a general contractor, plumber, or an electrician, this guide includes everything you need to know about the process.
In this guide, we’ll walk you through what you need to know to become a licensed contractor in the state of Hawaii. Let’s dive in!
Do I Need a Contractors License in Hawaii?
Like most states, anyone who is contracted for residential, public works, construction, improvements, or anything of the like must have a contractor’s license.
According to the Hawaii Revised Statutes section 444-7(c), a general contractor is defined as, “a contractor whose principal contracting business is in connection with any structure built, being built, or to be built, for the support, shelter, and enclosure of persons, animals, chattels, or movable property of any kind, requiring in its construction the use of more than two unrelated building trades or crafts, or to do so superintend the whole or any part thereof.”
In other words, if you do contracting work, you need to be licensed. There are several types of contractor license classifications recognized by the Hawaii Contractor’s License Board, which you can check out here.
But not only is being licensed important from a compliance perspective, but it’s also great for business. People want to hire contractors that are not only law-abiding, but that have been verified to meet the experience, education, and other requirements as set by the State of Hawaii.
Contracting work can make consumers nervous—it’s a big undertaking both financially and physically in most cases—so being licensed can help put anxious minds at ease.
How do You Get a Hawaii Contractors License?
Although there are quite a few requirements to get your Hawaii contractors license, they are pretty standard terms.
Applicants must meet the following criteria:
- You must be 18+ years old.
- You must disclose your Social Security number and a credit report from the last six months.
- You must have a good reputation.
- You must prove four years of supervisory experience (within the last ten years of your application date) as well as a chronological history of projects form.
- You must take and pass the exam that corresponds with the license you wish to apply. However, you won’t be able to take the exam until your application is approved.
- You must provide a compiled, reviewed, or audited financial statement along with an independent accountant’s report of your financial standing.
- You must obtain the proper insurance coverage like general liability insurance and workers’ compensation.
- You must include a recent Hawaii Tax Clearance with an original State Department of Taxation stamp.
- If you want to use a trading name, you’re required to submit a file-stamped copy of that name registration approved by the Hawaii Business Registration Division of the Department of Commerce and Consumer Affairs.
- If you’ve registered (or plan on registering) your business as an LLC or joint venture, you must appoint a Registered Managing Employee. If you haven’t registered yet, be sure to do so with the Business Registration Division (BREG), Department of Commerce and Consumer Affairs.
You’ll be asked to provide this information either in the application itself or at some point during the process.
There are several fees you’re responsible for paying:
- Application fee: $50.00 per application.
- Exam fee: $75.00 per part.
- License fee: For contracting entities and sole proprietors, you’ll pay $663.00 if you get your license between October 1 of an even-numbered year and September 30 of an odd-numbered year, and $494.00 if you get your license between October 1 of an odd-numbered year and September 30 of an even-numbered year.
Once you meet these requirements, you’re well on your way to becoming a licensed contractor in Hawaii. However, there are a few other important details we need to cover, as well.
Essential Application Details You Need to Know
When applying for your contractor’s license, it’s important to have your ducks in a row to not delay the processing time. An incomplete application means a longer wait time—and more work on your end finding what documents or information is missing.
Let’s take a look at some of the important details of the application process.
1. Get the proper insurance coverage.
All licensed contractors who operate in Hawaii are required to hold current policies of both workers’ compensation insurance (if you have employees, of course) and general liability and property damage insurance.
According to the application, if your coverage expires and you fail to reinstate it within 60 days of expiration, you’re subject to automatic forfeiture of your license. The moral of the story: keep your coverage up to date!
To meet the workers’ compensation requirements, you need to not only provide a certificate of coverage but a statement from your provider that they’ll notify the Board of any changes about the insurance.
For general liability and property damage insurance, you must submit a certificate from a provider that is authorized to do business in Hawaii, showing complete policy coverage. You are required to have the following minimums for each type of liability insurance:
- Bodily injury liability: $100,000 per person and $300,000 per occurrence
- Property damage liability: $50,000 per occurrence
Make sure you’re getting the right policy at the best price by requesting a quote to ensure you’re covered.
Applying for an HI Contractor’s License?
You may need to show proof of business insurance to get your license.
That’s where we come in. Compare insurance quotes today.
2. Prepare for and schedule your contractor’s exam.
After your application is approved, the Contractor Board of Hawaii will notify you when you can schedule an exam for your Hawaii contractors license.
There are two parts to the contractor’s exam:
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Business and Law Exam (Part 1): This exam will test your knowledge of contractor rules and laws. Unlike other states, this test is closed book, meaning you can’t use notes, and you must score a 75% or higher to pass. You can find the official rules and laws on the Department of Commerce and Consumer Affairs, Professional & Vocational Licensing Division website.
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Trade Exam (Part 2): This part of the exam will test your knowledge about a variety of services that contractors provide depending on the trade. This test is also closed book, and you need to score at least 75% to pass.
3. Register your business with the Hawaii Secretary of State.
All applicants must register their business with the Department of Commerce and Consumer Affairs. The process is simple, and with your eHawaii.gov account, you can manage your registration all from one dashboard.
Check out our quick guide if you need tips registering your business in Hawaii.
You can register your business as an LLC, LLP, corporation, sole proprietor, and a nonprofit. The cost of registering will depend on the type of business entity you choose.
How Much Work Can You do Without a Contractor License in Hawaii?
If the cost for the work (labor and materials) is less than $1,000, a contractor’s license is not required.
Does a Handyman Need a License in Hawaii?
Whether or not you need a license is determined by the value of the labor and materials for a specific project. As we mentioned above, if the total cost is more than $1,000, a licensed contractor is needed to perform the work.
Get Your Contractor License with Our Simple Guide!
If you have more questions about contractor licensing, the process, or the requirements, leave a comment below! We’re happy to assist.
Also, check out our guide on How to Become a General Contractor in 6 Steps for more helpful advice.