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A Guide to Contractor Bonding

SuretyBonds.com is an agency licensed to issue contractor license bonds in every state. Whether you work construction in California, Oregon, Florida or Washington, we can bond you!

The more construction professionals know about surety bonds, the better prepared they'll be to buy or renew their contractor bonds. Therefore, our surety experts have developed this guide to contractor bonding.

This page is a guide to contractor license bonds. For information on surety bonds issued specifically for contracted construction projectsclick here.

Contractor Bonds by State

Contractor license bonds are required at the state, county, or local level to become a licensed contractor. Therefore, costs and requirements vary depending on where construction will take place. Select your state below for more specific information about contractor bonds in your area.

What is a Contractor Bond?

Contractor license bonds are legally enforceable contracts binding together three separate parties.

  1. The construction professional buying the contractor license bond acts as the principal.
  2. The entity requiring the contractor to be bonded acts as the obligee.
  3. The company issuing the bond and guaranteeing the contractor's obligation acts as the surety.

If a contractor fails to fulfill the bond's terms, then the obligee can make a claim on the contractor bond as a way to gain compensation for any damages.

However, the surety will not simply absorb the loss. Whereas underwriters of traditional insurance policies assume there will be a loss, surety underwriters consider the policies they write to have no risk.

In the event a claim is made against the bond, the contractor is expected to reimburse the surety for any money it pays when settling the claim.

Who is Protected by a Contractor Bond?

A frequent misunderstanding of contractor license bonds is they protect the contractor from being held liable for damages. Although bonds are generally issued by an insurance company, surety bond insurance differs from a traditional insurance policy.

This type of surety bond actually protects the general public by guaranteeing construction professionals will adhere to whatever stipulations are found within the bond's legal language. By purchasing contractor license bonds, construction professionals agree to work according to certain regulations, thus protecting government agencies and consumers from potential financial loss.

Save Money on Your Contractor License Bond

Many contractor bonds are subject to review by an underwriter who will approve the bond based on the applicant’s qualifications, such as credit score at the time of application.

Applicants with exceptional credit are typically approved to pay as little as 1% of the total bond amount. For example, a $10,000 contractor bond would cost the applicant just $100 for the bond’s term. Even if an applicant has less-than-stellar credit, SuretyBonds.com can often get an approval at a rate of 2-5% of the bond amount. We even offer financing so applicants have the option to make smaller, more manageable payments.

Regardless of your credit, SuretyBonds.com works with several of the largest providers in the industry, meaning we will shop around until we have secured your lowest available rate for your contractor bond. Apply today to find out how much you’ll save with SuretyBonds.com!

Get Your Contractor Bond Quickly & Easily

To become licensed contractors, applicants will have to complete more steps than just securing a general contractor bond. That is why we pride ourselves on ensuring you get the exact contractor bond you need quickly and easily—quotes are typically provided within one business day. Some bonds can even be purchased and delivered electronically on the same day if purchased online using our secure bond checkout.

Construction professionals who are ready to get bonded in order to secure a general contractor’s license can reach our surety specialists through the following methods:

Call 1 (800) 308-4358 to talk with a Surety Expert