New Jersey Service Contract Provider or Administrator Bond
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What Is a New Jersey Service Contract Provider Bond?
New Jersey service contract provider bonds guarantee that licensed providers have the ability to fulfill their service contracts. This type of surety bond protects customers by holding providers financially liable for upholding contracts and industry laws.
How Much Do Service Contract Provider Bonds Cost in New Jersey?
Service contract providers in New Jersey need to file a surety bond for at least $25,000 in coverage or 5% of the gross value of annual service contracts, whichever is greater.
$25,000 service contract provider bond premiums are calculated as $5 per $1,000 in coverage, with a $100 minimum. For higher coverage, exact pricing will vary based on the bond amount and the applicant’s credit score.
Who Needs a Service Contract Provider or Administrator Bond?
Service contract providers and administrators operating in New Jersey need to file a surety bond as part of the state licensing process. To be exempt from the surety bond requirement, you must meet one of the following criteria:
- Purchase a reimbursement insurance policy compliant with the requirements of NJSA 56:12-92
- Prove net worth or stockholder’s equity of at least $100,000,000
- Prove that the Department of Banking and Insurance has determined your business meets New Jersey financial solvency standards
How Do I Get a Service Contractor Bond in New Jersey?
SuretyBonds.com offers the quickest and most affordable way to get your New Jersey service contract provider or administrator bond:
- Step 1: Apply for your bond and receive an instant price quote.
- Step 2: Purchase your NJ Service Contract Provider bond online.
- Step 3: Sign and notarize your emailed bond form.
- Step 4: File your bond with the NJ Office of the Attorney General
How Do New Jersey Service Contractor Bonds Work?
Service contracts act similarly to warranties or extended maintenance policies. New Jersey requires providers of these contracts to prove their financial ability to fulfill the contract and fund future maintenance or repairs.
Surety bonds provide financial safety for clients hiring contract service providers. If a provider or administrator breaks industry laws, the harmed customer can file a bond claim for reimbursement. The surety will pay out valid claims to the consumer then recover the funds from the provider.
How to Become a Licensed Service Contractor in New Jersey
First, email your Service Contractor Registration Application to [email protected] along with supporting documentation. Then, separately mail a check or money order for the $300 registration fee to the address below:
New Jersey Division of Consumer Affairs
Office of Consumer Protection, Regulated Business Section
124 Halsey St
7th Floor
P.O. Box 45028
Newark, NJ 07101
The state typically takes 30–60 days to approve applications.
How Do I Renew My New Jersey Service Contract Provider or Administrator Bond?
These bonds require annual renewal. A SuretyBonds.com team member will contact you with a renewal invoice and instructions during the renewal period. If the surety company decides to cancel the bond for any reason, they must provide 30-days written notice to the obligee.
Have Questions?
Call 1 (800) 308-4358 to talk with a Surety Expert today.
