Do You Need a License to Start an Excavating Business?

Nate Jones
Jul 20
2 min read

If you're thinking about starting an excavating business, one of the first questions you might ask is: “Do I need a license to get started?” The answer depends on your location, the type of work you plan to do, and whether you’ll be operating heavy equipment or hiring employees.

In this blog, we’ll break down the licensing requirements at the federal, state, and local levels—and how Excavating Insurance Partners can help you protect your business with the right insurance coverage from day one.

Federal Licensing Requirements

At the federal level, there is no national license required to operate an excavating business. However, the Occupational Safety and Health Administration (OSHA) requires that all excavator operators be properly trained and qualified. Employers must document that operators are competent to safely use the equipment, including:

Formal instruction (classroom or online)
Hands-on training
On-site performance evaluation

State Licensing Requirements

Licensing requirements vary significantly by state. Some states require a general contractor’s license or a specialty license for excavation work. Others may require operator certifications or bonding.

Examples:

California: Requires a C-12 Earthwork and Paving Contractor license
Tennessee: Requires a contractor’s license for excavation over $25,000
Michigan: Excavation contractors must register with the Department of Licensing and Regulatory Affairs
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Local Licensing and Permits

Even if your state doesn’t require a license, your city or county might. Local governments often require:

Business licenses
Excavation permits for each job site
Right-of-way or street opening permits
Proof of insurance and bonding

Do You Need a CDL?

If you plan to haul heavy equipment using large trucks, you or your employees may need a Commercial Driver’s License (CDL). This is issued by your state’s Department of Motor Vehicles and is required for operating vehicles over a certain weight.

Insurance Requirements

Most licensing authorities require proof of insurance before issuing a license or permit. At Excavating Insurance Partners, we help you secure:

Want to Learn More?

If you're just getting started, download our e-book:📘 How to Start an Excavating Business It covers everything from equipment and licensing to marketing and insurance.

Final Thoughts

While not every state requires a license to start an excavating business, many do—and local governments often have their own rules. It’s essential to research your area’s requirements and ensure you’re fully compliant before taking on your first job.

Need help protecting your business? Contact Excavating Insurance Partners for expert guidance and tailored insurance solutions for excavation contractors.