Arizona Service Company Bond Guide
If you’re applying for an Arizona service company permit, you’ll need a surety bond. Learn all about the bonding process in this guide.
Bond Overview
- Purpose: To guarantee companies uphold consumer service contracts
- Who Needs It: Companies applying for a service company permit in Arizona
- Regulating Body: The Arizona Department of Insurance and Financial Institutions
- Required Coverage: $100,000
- Premium Rate: Typically $3,000–$5,000, credit-based
What Is an Arizona Service Company Bond?
The Arizona Department of Insurance and Financial Institutions (DIFI) requires a $100,000 service company bond for any business that offers service contracts or warranties.
This type of license and permit bond holds service companies financially liable for upholding consumer service contract terms.
How Much Do Service Company Bonds Cost in Arizona?
The state-required $100,000 Arizona service company bond costs a small percentage of the bond amount. Qualified applicants often pay around $3,000–$4,000 for the 1-year term.
However, exact pricing varies by applicant based on credit score and other financial qualifications. Apply to get your free quote now.
SuretyBonds.com offers the lowest available rates from our nationwide provider network with no added fees.
How Does an Arizona Service Company Bond Work?
This type of surety bond creates a financial guarantee contract between three parties:
- Principal: The service company owner filing the bond
- Obligee: The Arizona DIFI, Service Company Permit Team requiring the bond
- Surety: The provider issuing the bond
As the principal, you must uphold the contract terms or you become liable for bond claims.
Who Needs a Service Company Bond?
Any company applying for an Alabama service company bond must provide proof of $100,000 surety bond coverage.
However, the following companies are exempt from the service company license and bond requirement:
- Product manufacturers and affiliates that issue product warranties
- Motor vehicle manufacturers that pay claims for service contracts they sell
- Companies that sell service contracts to non-consumers
- Companies that issue service contracts that only cover one of the following product categories: appliances/electronics, residential HVAC systems, non-motor vehicle mechanical equipment
- Companies that sell or service cell phones, tablets, and other personal electronics
- Licensed residential contractors who sell service contracts on their work
- Companies that issue maintenance agreements without repair or replacement guarantees
How Do I Get a Service Company Bond in Arizona?
To get bonded quickly and easily, start by requesting a free quote online. We’ll provide your personalized Arizona service company bond rate.
Then, you can sign and checkout online or over the phone. We’ll deliver your official bond form via email shortly after purchase.
How Do I Renew My Service Company Bond?
These bonds expire annually. To renew your bond for another year, pay your renewal invoice before the expiration date.
We’ll contact you with renewal reminders in advance to ensure there is no lapse in coverage.
