MD MHIC Contractor
Maryland Home Improvement Commission (MHIC) Contractor License Exam
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ExploreAbout this exam
The Maryland Home Improvement Commission (MHIC), part of the Maryland Department of Labor's Division of Occupational and Professional Licensing, licenses and regulates home improvement contractors and salespersons in Maryland. The MHIC contractor license is the credential a business needs before it may enter into a contract with a homeowner to perform home improvement work; the Commission states that only MHIC licensed contractors may contract with homeowners, while unlicensed subcontractors may work for a licensed contractor. The contractor's exam is administered by PSI Exams, a private testing firm, and the Commission publishes an exam application and a contractor's study guide. Expect multiple-choice questions spanning four areas: what counts as home improvement and what a contract must contain; the home improvement law and regulations the Commission enforces; the Guaranty Fund and how claims are filed and paid; and licensing, insurance, and business practices. Preparation should center on the Commission's own study guide and site pages, especially the definitions of home improvement, the Guaranty Fund recovery limits and pro-rating rule, the general liability insurance minimum, the rooftop solar wildlife-barrier contract requirement, and the public-adjuster restriction. Confirm current fees, scheduling, and any revised requirements directly with PSI and the Commission before you apply, since the Commission has raised application and licensing fees and changed Guaranty Fund assessments. This page is independent study material and is not affiliated with or endorsed by the Commission.
What you'll study
About MD MHIC Contractor preparation
Who administers the MHIC contractor's exam and how do I apply?
The exam is administered by PSI Exams, which the Commission describes as its private testing firm. The Commission's site links to the PSI page, the application for the MHIC contractor's exam, the contractor's study guide, and the original license application and instructions. Start with those links, then confirm scheduling and fees with PSI and the Commission.
What score do I need to pass, and how long is the exam?
Those details are not published on the Commission pages summarized here, so treat any specific number you see elsewhere with caution. Get the current passing score, question count, and time limit from PSI's candidate information or from the Commission directly before you schedule.
Does the exam cover the Guaranty Fund?
Yes. The Commission's site explains the Fund in detail: contractors pay an assessment when licensed and at each renewal, and the Fund compensates homeowners for actual monetary losses from poor workmanship or failure to perform. Know the $30,000 maximum recovery, the $250,000 pro-rating threshold, and the restriction to work by licensed contractors.
Which dollar figures are most likely to be tested?
Three stand out on the Commission's site. The maximum Guaranty Fund recovery is the amount paid to the contractor, up to $30,000. Awards are pro-rated when all claims against a contractor exceed $250,000. And effective June 1, 2024, contractors must carry general liability insurance of at least $500,000.
What contract requirement applies to rooftop solar installations?
Effective June 1, 2024, contracts for rooftop solar panel installation must include a barrier meeting industry standards to prevent wildlife intrusion and damage to the system or roof, unless the customer waives it after being informed of the barrier's cost and the risks of not installing it. The Commission recommends documenting the price, the risks, and the customer's initials.
Can a licensed contractor help a homeowner with an insurance claim?
Only partly. A contractor may prepare an estimate for repair of damage from fire, storm, or flood and may answer the insurer's questions about that estimate. Without a public adjuster license from the Maryland Insurance Administration, a contractor may not prepare the homeowner's claim, negotiate it, or advise on policy coverage.
Do subcontractors need their own MHIC license?
No. Maryland eliminated the subcontractor license category as of July 1, 2016, along with its application, examination, and renewal requirements. Subcontractors may perform home improvements for an MHIC licensed contractor without a license, but only licensed contractors may contract with homeowners. The Commission encourages anyone aiming to become a contractor to apply.
What is the most common way candidates lose points?
Mixing up who may do what: assuming subcontractors need licenses, assuming a contractor license permits public adjusting, or assuming the Guaranty Fund covers unlicensed work. Another frequent slip is carrying forward outdated dollar amounts instead of the current $30,000 recovery cap and $500,000 insurance minimum.
What study order do you recommend?
Start with the Commission's definitions of home improvement and the contract page, then the law and regulations, then the Guaranty Fund and claims process, then licensing, insurance, and business practices. Finish with the Commission's study guide and the notices section, which carries the newest insurance and solar requirements.
How do I keep my license and what does it cost?
Licenses renew through the Commission, and the Commission now issues PDF licenses by e-mail rather than hard copies, effective July 9, 2021. Application and licensing fees increased effective August 1, 2024, and the Guaranty Fund assessment is $100 for an original contractor and $175 every two years on renewal. Check the current fee schedule.