Contractor Insurance in Arizona
The Arizona ROC requires a license bond and proof of workers comp. It does not require general liability. Your contracts do. Here is what the state requires, what your deals add, and the Arizona laws that shape both, including a 2026 ghost policy rule every GC collecting certificates needs to know.
Business Insurance › Contractors › Arizona
We grew up in the trades, and contractors are the core of what we do. Grit places insurance and surety bonds for Arizona contractors, from one-truck operations to general contractors bidding public work.
Arizona contractor insurance comes in three layers: what the ROC and the state require, what your contracts require, and what keeps one bad job from ending the company. For how other states compare, see our contractor insurance requirements by state.
Written and reviewed by the Grit Insurance Group team · Last reviewed October 12, 2026
Grit is an independent brokerage licensed in Arizona. We place commercial insurance and surety bonds for Arizona businesses from our headquarters in Salt Lake City.
What Insurance Does an Arizona Contractor Need?
For the license: an ROC license bond, and workers comp if you have employees. For the road: auto liability on every business vehicle. For the work: general liability, because nearly every contract requires it, plus whatever else your contracts add, usually an umbrella and specific endorsements.
Does the Arizona ROC Require General Liability Insurance?
No.
"With the exception of workman's compensation insurance, the ROC does not require an entity to possess insurance to be licensed."
That is the Arizona Registrar of Contractors (ROC), in its own words.
What the ROC does require is a workers comp attestation. Under A.R.S. 32-1122, your license application must attest that you comply with the comp law, and if you are required to carry comp, the attestation must include your policy number or proof of self-insurance.
Skipping GL because the license does not require it is a mistake. General contractors, owners, lenders and public agencies require it, and one uninsured claim can cost more than years of premium. See our Arizona business insurance guide for how GL works in Arizona.
How Much Is an Arizona Contractor License Bond?
A.R.S. 32-1152 requires a surety bond or cash deposit before the ROC issues a license, and a license cannot be renewed unless the bond is in force. The statute sets ranges; rule A.A.C. R4-9-112 sets the actual amounts, based on license type and estimated annual volume:
| License type | Est. annual volume | Bond |
|---|---|---|
| General commercial (incl. general engineering) | Less than $150,000 | $5,000 |
| $150,000 to less than $500,000 | $15,000 | |
| $500,000 to less than $1M | $25,000 | |
| $1M to less than $5M | $50,000 | |
| $5M to less than $10M | $75,000 | |
| $10M or more | $100,000 | |
| Specialty commercial | Less than $150,000 | $2,500 |
| $150,000 to less than $500,000 | $7,000 | |
| $500,000 to less than $1M | $17,500 | |
| $1M to less than $5M | $25,000 | |
| $5M to less than $10M | $37,500 | |
| $10M or more | $50,000 | |
| General residential | Less than $750,000 | $9,000 |
| $750,000 or more | $15,000 | |
| Specialty residential | Less than $375,000 | $4,250 |
| $375,000 or more | $7,500 |
Dual licenses combine the residential and commercial amounts. If the surety cancels the bond, the license is suspended by operation of law unless it is replaced. Details on our Arizona contractor license bond page.
The Residential Contractors' Recovery Fund
Residential and dual licensees have a choice under A.R.S. 32-1152(C): pay into the Residential Contractors' Recovery Fund, or post an additional $200,000 bond or cash deposit.
- Assessment: $370 on a new residential or dual license and $270 on renewal, per the ROC fee schedule. The statute caps it at $600 per two-year license period. Commercial-only licenses pay nothing.
- Awards: up to $30,000 per residence and $200,000 per residential contractor license. Claimants must claim against the license bond first.
- Who it pays: homeowners. It does not take claims from suppliers, subcontractors, laborers or other commercial entities.
The 2026 Ghost Policy Rule and Your Sub Certificates
SB 1428 (Laws 2026, Chapter 228) added A.R.S. 23-911. It regulates a "zero estimated exposure" workers comp policy, the policy the industry calls a ghost policy. It is bought by a business that says it has no employees.
- Every zero estimated exposure policy must include the applicant's written statement that it has no employees and an estimated exposure of zero, and a promise to notify the carrier within 60 days of hiring.
- A construction employer that carries one must give each entity it directly contracts with a copy of the policy and written notice that its total estimated exposure is zero. The recipient keeps it for at least three years.
- Any certificate of insurance requested on a construction-related zero exposure policy must say: "TO CONFIRM THE STATUS OF THE WORKERS' COMPENSATION POLICY, GO TO EWCCV.COM/CVS/".
- The rule applies to policies and certificates entered into or prepared on or after July 1, 2027.
Why it matters to a GC: under A.R.S. 23-902(B), when you control a sub's work and it is part of your business, the sub's employees are treated as yours for comp. A sub on a zero exposure policy that brings a crew can turn into your claim and your audit charge. Starting July 1, 2027, check every certificate for the verification line, and keep the notice and policy copy in the file for three years. More on our Arizona workers comp page.
Arizona Anti-Indemnity: Private Work vs Public Work
| Private construction (A.R.S. 32-1159) | Public construction (A.R.S. 34-226) | |
|---|---|---|
| What is void | A clause making you indemnify, hold harmless or defend the other party against its sole negligence | Any requirement to defend, indemnify, insure or hold the agency harmless beyond what the statute allows |
| What is allowed | The statute voids only sole-negligence clauses. Anything else turns on the contract language, so have your attorney read it | Indemnity only to the extent caused by the negligence, recklessness or intentional wrongful conduct of you or your subs |
| Insurance requirements | Set by the contract | The agency may require additional insured status on your GL and designated insured status on your auto |
The practical split: on private work, Arizona only voids broad-form, sole-negligence indemnity, so a lot of risk can still be shifted to you by contract. On public work, you answer for your own fault. Cities and counties cannot add their own rules. Have your attorney review the contract language. We will tell you what your policy actually provides.
Other Arizona Requirements for Contractors
ADOR taxpayer bond. Under A.R.S. 42-5006, the Arizona Department of Revenue requires a surety bond from ROC-licensed contractors whose principal place of business is outside Arizona, or who have done business in Arizona for less than one year. The bond is at least $2,000, sized to about 150 days of expected transaction privilege tax, and kept for at least two years. A contractor with two years of timely tax payments can be exempted. Coming into Arizona from another state? Plan for this bond on top of your ROC license bond.
Auto. Arizona's minimum auto liability, for policies issued or renewed on or after July 1, 2020, is $25,000 per person and $50,000 per accident for bodily injury and $15,000 for property damage (A.R.S. 28-4009). If one policy covers a fleet of seven or more vehicles, the most it pays for any one accident is the limit stated in the policy. Coverage does not stack for each vehicle on the policy.
The Full Arizona Contractor Program
| Coverage | What it covers | Why Arizona contractors need it |
|---|---|---|
| General liability | Injury and property damage to others, including completed work | Not required by the ROC; required by nearly every contract |
| Workers compensation | Employee injuries | Required with regular employees; policy number goes on the ROC application |
| Commercial auto | Trucks, trailers, hired and non-owned vehicles | State minimum 25/50/15; contracts require more |
| Inland marine / equipment | Tools and equipment on site or in transit | GL and property do not cover your own equipment at the job |
| Builders risk | The structure under construction | Often required on new builds and remodels |
| Umbrella | Limits above GL, auto and employer's liability | How most contractors meet higher contract limits |
| Contractors pollution | Pollution caused by your operations | Excluded from standard GL |
Arizona Contractor Bonds
The ROC license bond is the start. Public work requires bid, performance and payment bonds, and building that capacity takes a program, not a one-off quote. Our Arizona contractor license bond page covers the license side.
Looking for public work to bid? Start with our guide to finding construction work in Arizona. Bonding for the first time or need more capacity? Take the Bond Scorecard.
Arizona Contractor Insurance by Trade
- General contractors
- Excavation and concrete
- Roofing
- Electrical, plumbing and HVAC
- Landscaping and painting
How Much Does Contractor Insurance Cost in Arizona?
Your trade sets most of it. After that it is payroll, revenue, subcontracted work and whether those subs carry their own insurance, your claims history, and the limits your contracts require. Our contractor general liability cost guide shows how GL cost varies by state and trade.
Frequently Asked Questions
What insurance does an Arizona contractor need?
The ROC requires a license bond and, if you have employees, workers compensation, with the policy number on your license application. State law requires auto liability on business vehicles. General liability is not required for the license, but nearly every contract and lease requires it.
Does the Arizona ROC require general liability insurance?
No. The Registrar of Contractors states that, with the exception of workers compensation, it does not require an entity to have insurance to be licensed.
How much is an Arizona contractor license bond?
Amounts are fixed by rule A.A.C. R4-9-112 and depend on license type and estimated annual volume, from $2,500 for a small specialty commercial license to $100,000 for general commercial at $10 million or more. Dual licenses combine the residential and commercial amounts.
What is the Arizona Residential Contractors' Recovery Fund?
A state fund that pays homeowners harmed by a residential contractor, up to $30,000 per residence and $200,000 per license. Residential and dual licensees either pay the assessment, currently $370 on a new license and $270 on renewal, or post an additional $200,000 bond or cash deposit.
How much does contractor insurance cost in Arizona?
It depends on your trade, payroll, revenue, subcontracted work, claims history and the limits your contracts require. The fastest route to a real number is quoting several carriers at once.
Get Your Arizona Contractor Program Quoted
Tell us your trade, your payroll, your ROC license type and what your contracts require. We will build the insurance program and the bond program together.
Call the Grit team at (801) 505-5500 or start online.
