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Contractor Terms, Plainly

30 terms you meet when hiring a contractor in Florida, each in one or two plain sentences. Where Florida law defines the word, we say what it says and link the statute.

30terms in 3 groups
$2,500contract size above which two written notices are required
45days a supplier has to serve a notice to owner after starting

The $2,500 figure: home contracts above it must include a lien law notice and a Recovery Fund notice.21,14 The 45 days come from the lien law.22

Licenses and Status

License codes such as CFC or CAC are decoded in Florida contractor license types.

Licensing terms
TermPlain meaning
LicensedIn Florida contracting, it means certified or registered by the state. Florida law requires one or the other to engage in the business of contracting.2
CertifiedHolds a state certificate of competency. May contract anywhere in Florida. Construction codes start with C; certified electrical codes include EC and ES.1,6
RegisteredMet local competency rules and registered with the state. May contract only in those local areas. Construction codes start with R; registered electrical codes include ER and ET.1,3,6
Qualifier, qualifying agentThe licensed person who supervises a company's contracting work. A company may operate only if its qualifying agent is certified or registered.1,4 A "secondary" qualifying agent supervises jobs he or she pulled permits for.1
Business tax receiptA local tax document issued under chapter 205. Florida law says it is not a contractor license.8
Current, ActiveDBPR status codes. "Current" is a primary status; "Active" is a secondary status.6 A licensee may practice only with an active status license.5
InactiveThe holder chose inactive status at renewal. An inactive licensee may not practice until the license is made active again.5
DelinquentThe license was not renewed before it expired.5
VoidA delinquent license that was not made active or inactive by the end of the next license cycle. It becomes void with no further action by the board.5
Probation, SuspendedDBPR primary status codes that follow discipline.6
Disciplinary actionA board penalty against a licensee: reprimand, probation, suspension, revocation, restitution to a consumer, or a fine of up to $10,000 per violation.7
Unlicensed contractingContracting without the required license. A first offense is a first-degree misdemeanor. A repeat, or an offense during a declared state of emergency, is a third-degree felony.8 An unlicensed contractor cannot enforce the contract or claim a lien for that work.9

Insurance, Bonds and Money

Insurance and money terms
TermPlain meaning
Insured, general liabilityInsurance that pays for damage or injury the contractor causes to others. To get or renew a license, a contractor files an affidavit of public liability and property damage insurance.10 A local government may fine an unlicensed person who claims to be insured when the work is not covered by a general liability or workers' compensation policy.4
Workers' compensationInsurance that pays for injuries to the contractor's workers. In construction, it applies to an employer with one or more employees.12 Evidence of coverage is required to issue or renew a license.11
Workers' comp exemptionA filed election by a corporate officer to be exempt. In construction, no more than three officers may elect it, and each must own at least 10 percent of the stock.12 A certificate of exemption is valid for 2 years.13
BondedBacked by a surety bond, which a third party pays out under set conditions. The word is not a license class. Falsely saying work is bonded is grounds for discipline.7
Payment bondA bond that secures payment to subcontractors and suppliers. If the contractor furnishes one, the owner is exempt from most of the lien law for that contract.23
Recovery FundThe Florida Homeowners' Construction Recovery Fund. It can pay a homeowner who lost money because a licensed contractor committed certain violations, such as financial mismanagement, abandoning the job, or false statements about bonds, payments or insurance.15,7 The homeowner usually needs a court judgment, arbitration award or board restitution order first.15
Recovery Fund limitsFor contracts signed on or after July 1, 2024: up to $100,000 per claim against a general, building or residential contractor, and up to $30,000 per claim against other trades such as plumbing, AC or roofing.16,1
DepositAn up-front payment. A contractor who takes more than 10 percent of the price on a home job must apply for permits within 30 days and start work within 90 days after permits are issued, unless there is just cause or the owner agreed in writing to longer.17
Estimate vs quoteNeither word is defined in Florida's contractor law.25 So the price means what the paper says. Ask if the price is fixed or can change, and get the answer in writing.
WarrantyA promise to fix defects for a period. Its terms come from the contract or the maker of the equipment. The Recovery Fund pays only after any available warranty, bond or insurance is used up.15
Note

The Recovery Fund notice is a block of capital letters that must appear in home contracts over $2,500. It starts with the words "Florida Homeowners' Construction Recovery Fund".14 If a home contract over that amount lacks it, the board may fine the contractor.14

Permits, Liens and Paperwork

Permit and lien terms
TermPlain meaning
PermitWritten approval from the local building department. Unless the law says otherwise, it is unlawful to build, alter, repair or demolish a building without one.18 How to read one: reading a building permit.
InspectionA visit by a local building official to check permitted work. The Florida Building Code sets a minimum number of inspections.18
Owner-builderA property owner who acts as his or her own contractor. The license law exempts owners who build or improve their own one- or two-family home for their own use, not for sale or lease, and supervise the work on site.19
Construction lienA claim against your property by someone who worked on it or supplied materials and was not paid in full. It can apply even if you already paid your contractor.21
Notice of commencementA form the owner records with the county clerk before work starts, with a copy posted at the job. Jobs of $2,500 or less are exempt.20,23
Notice to ownerA notice from a subcontractor or supplier you did not hire directly. It must be served before they start or within 45 days after starting. Without it, they cannot enforce a lien.22
Release of lienA written waiver of lien rights. The required contract notice advises owners to get one from anyone who sent a notice to owner, before paying.21
DBA, fictitious nameAny name a business uses other than its legal name. It must be registered with the Florida Division of Corporations before use.24

More on checking a company before you sign: before you hire and public business records.

Sources

  1. Florida Legislature, The 2026 Florida Statutes, s. 489.105, "Definitions", leg.state.fl.us, accessed Oct 7, 2026.
  2. Florida Legislature, The 2026 Florida Statutes, s. 489.113, "Qualifications for practice; restrictions", leg.state.fl.us, accessed Oct 7, 2026.
  3. Florida Legislature, The 2026 Florida Statutes, s. 489.117, "Registration; specialty contractors", leg.state.fl.us, accessed Oct 7, 2026.
  4. Florida Legislature, The 2026 Florida Statutes, s. 489.119, "Business organizations; qualifying agents", leg.state.fl.us, accessed Oct 7, 2026.
  5. Florida Legislature, The 2026 Florida Statutes, s. 455.271, "Inactive and delinquent status", leg.state.fl.us, accessed Oct 7, 2026.
  6. Florida DBPR, "Understanding DBPR Codes", www2.myfloridalicense.com/about-us/understanding-dbpr-codes/, accessed Oct 7, 2026.
  7. Florida Legislature, The 2026 Florida Statutes, s. 489.129, "Disciplinary proceedings", leg.state.fl.us, accessed Oct 7, 2026.
  8. Florida Legislature, The 2026 Florida Statutes, s. 489.127, "Prohibitions; penalties", leg.state.fl.us, accessed Oct 7, 2026.
  9. Florida Legislature, The 2026 Florida Statutes, s. 489.128, "Contracts entered into by unlicensed contractors unenforceable", leg.state.fl.us, accessed Oct 7, 2026.
  10. Florida Legislature, The 2026 Florida Statutes, s. 489.115, "Certification and registration; endorsement; reciprocity; renewals; continuing education", leg.state.fl.us, accessed Oct 7, 2026.
  11. Florida Legislature, The 2026 Florida Statutes, s. 489.114, "Evidence of workers' compensation coverage", leg.state.fl.us, accessed Oct 7, 2026.
  12. Florida Legislature, The 2026 Florida Statutes, s. 440.02, "Definitions" (workers' compensation), leg.state.fl.us, accessed Oct 7, 2026.
  13. Florida Legislature, The 2026 Florida Statutes, s. 440.05, "Election of exemption; revocation of election; notice; certification", leg.state.fl.us, accessed Oct 7, 2026.
  14. Florida Legislature, The 2026 Florida Statutes, s. 489.1425, "Duty of contractor to notify residential property owner of recovery fund", leg.state.fl.us, accessed Oct 7, 2026.
  15. Florida Legislature, The 2026 Florida Statutes, s. 489.141, "Conditions for recovery; eligibility", leg.state.fl.us, accessed Oct 7, 2026.
  16. Florida Legislature, The 2026 Florida Statutes, s. 489.143, "Payment from the fund", leg.state.fl.us, accessed Oct 7, 2026.
  17. Florida Legislature, The 2026 Florida Statutes, s. 489.126, "Moneys received by contractors", leg.state.fl.us, accessed Oct 7, 2026.
  18. Florida Legislature, The 2026 Florida Statutes, s. 553.79, "Permits; applications; issuance; inspections", leg.state.fl.us, accessed Oct 7, 2026.
  19. Florida Legislature, The 2026 Florida Statutes, s. 489.103, "Exemptions", leg.state.fl.us, accessed Oct 7, 2026.
  20. Florida Legislature, The 2026 Florida Statutes, s. 713.13, "Notice of commencement", leg.state.fl.us, accessed Oct 7, 2026.
  21. Florida Legislature, The 2026 Florida Statutes, s. 713.015, "Mandatory provisions for direct contracts", leg.state.fl.us, accessed Oct 7, 2026.
  22. Florida Legislature, The 2026 Florida Statutes, s. 713.06, "Liens of persons not in privity; proper payments", leg.state.fl.us, accessed Oct 7, 2026.
  23. Florida Legislature, The 2026 Florida Statutes, s. 713.02, "Types of lienors and exemptions", leg.state.fl.us, accessed Oct 7, 2026.
  24. Florida Legislature, The 2026 Florida Statutes, s. 865.09, "Fictitious name registration", leg.state.fl.us, accessed Oct 7, 2026.
  25. Florida Legislature, The 2026 Florida Statutes, chapter 489, "Contracting" (full text searched for "estimate" and "quote"), leg.state.fl.us, accessed Oct 7, 2026.