Quick facts: Maryland requirements
- License
- Maryland Home Improvement Commission (MHIC) license
- Insurance
- $50,000 liability insurance minimum, filed and maintained continuously
Fees, insurance minimums, and rules change. Verify every item with the responsible agency before you rely on it.
Maryland's Home Improvement Commission runs a single licensing track that combines a real exam, an experience bar, and a financial-solvency check most states don't ask for.
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What starting a Maryland contracting business actually involves
You have to pass an exam - there's no experience-only path. Every applicant takes and passes the MHIC licensing exam, administered through PSI Examinations, before they can even apply for the license. Alongside that, you need proof of at least two years of experience in home improvement work, construction, or related education.
Maryland checks your finances, not just your skills. Applicants have to demonstrate financial solvency through documentation of assets, liabilities, credit reports, and net worth relative to the scope of the business. If you don't meet the financial solvency guidelines outright, you have a fallback: purchase a surety bond or obtain an indemnitor instead of clearing the check directly.
The insurance minimum is fixed and has to stay current. You need proof of at least $50,000 in liability insurance filed with your application, and it has to be maintained continuously after that - if you're going to cancel or let it lapse, the Commission has to be notified at least 10 days beforehand.
A specific, real list of exemptions covers people who aren't running an independent contracting business. Salaried or wage employees who aren't salespeople, clerical staff or retail clerks of a licensed contractor working on the contractor's own premises, phone solicitors who only call owners by telephone, licensed professionals like architects, electricians, plumbers, and HVAC/refrigeration contractors working within their scope, and marine contractors and security technicians licensed under separate articles are all exempt from needing a separate MHIC license.
Where people get stuck
The mistake is treating the exam or the experience requirement as the whole picture and getting blindsided by the financial solvency review. If your assets, liabilities, and credit don't clear the bar on their own, you need the bond or indemnitor fallback lined up before you apply - not after your application stalls.
Not sure if you'll clear the financial solvency check, or need the bond fallback? Contractor Lane walks through it with you.
Where Contractor Lane comes in
Contractor Lane helps you get your experience documentation, exam registration, and financial solvency paperwork - or bond alternative - lined up before you apply.
Build your free roadmap to get the sequence for your specific trade and target project size.
General educational information for people starting a business in Maryland. Requirements and fees change. Contractor Lane is not a law firm or tax advisor.
Common questions
What does it take to get a Maryland Home Improvement Commission (MHIC) license?
You need to pass the MHIC licensing exam through PSI Examinations, show at least two years of experience in home improvement work, construction, or related education, and demonstrate financial solvency through assets, liabilities, credit reports, and net worth documentation. Contractors who don't meet the financial solvency guidelines can instead purchase a surety bond or obtain an indemnitor. You also need proof of at least $50,000 in liability insurance filed with your application and maintained continuously. Source: Maryland Home Improvement Commission, license requirements.
Who is exempt from needing an MHIC license?
Exemptions include salaried or wage employees who aren't salespeople, clerical staff or retail clerks of a licensed contractor working on the contractor's premises, phone solicitors who only call owners by telephone, licensed professionals like architects, electricians, plumbers, and HVAC/refrigeration contractors working within their scope, security technicians licensed under a separate article, marine contractors licensed under the Environment Article, and people selling improvements to be performed by someone in one of those licensed-professional categories. Source: Maryland Business Regulation Article 8-301.