Virginia Home Service Contract Provider Bond Guide
All home service contract providers in Virginia need a bond to get licensed. Use this guide to learn more about the bonding process.
Bond Overview
- Purpose: To ensure service providers fulfill their contracts
- Who Needs It: All home service contract providers in Virginia
- Regulating Body: The Department of Agriculture and Consumer Services (VDACS)
- Required Amount: $10k for initial licensing, $10k–$90k at renewal
- Premium Rates: 1–10% of the bond amount, credit-based
What Is a Virginia Home Service Contract Provider Bond?
A Virginia home service bond ensures that all providers fulfill their contracts and protects clients if they fail to do so. This often includes finishing all repair or maintenance projects covered under a service contract.
What Bond Amount Do I Need?
All providers need a $10,000 home service contract provider bond for initial licensing.
After your first term, the bond amount will be adjusted by the VDACS based on the total dollar amount of active contracts.
| Required Bond Amount | Value of Active Contracts |
|---|---|
| $10,000 | $50,000 or less |
| $40,000 | $50,000–$300,000 |
| $65,000 | $300,000–$750,000 |
| $90,000 | $750,000 or more |
How Much Do Home Service Contract Provider Bonds Cost in Virginia?
Your premium cost will be determined based on your bond amount and credit score. Rates are usually 1–10% of the bond amount.
With excellent personal credit, you could pay as little as $100 for the $10,000 bond amount. Get a free quote now.
SuretyBonds.com offers the lowest available rates from our nationwide provider network with no added fees.
How Does a Virginia Home Service Contract Provider Bond Work?
The Virginia home service contract provider bond binds the following three parties in a legal agreement:
- Principal: You, the contract provider
- Obligee: The Virginia Department of Agriculture and Consumer Services
- Surety: Us, the surety provider
If you violate the bond terms by not upholding a service contract, the surety will pay valid claims up to the total bond amount. However, you must reimburse the surety provider.
Who Needs a Home Service Contract Provider Bond?
Under Virginia Code § 59.1-434.1, a home service contract provider bond is required for all home repair project managers in Virginia. Common projects covered by home service projects include:
- Repair of property
- Roof leak coverage
- Service damage from power surges
- Accidental damage from handling
Providers may also file a letter of credit or proof of comprehensive liability insurance rather than a surety bond. However, surety bonds are typically the more affordable, flexible option.
Visit our blog to learn more about different forms of financial security.
How Do I Get a Home Service Contract Provider Bond in Virginia?
SuretyBonds.com provides the fastest and easiest way to get a home service contract provider bond. Just follow these simple steps:
- Apply: Submit a free quote request online
- Financials: Submit personal and business financial documents, if requested by the surety
- Sign: Once approved, complete the DocuSign for your indemnity agreement
- Purchase: Checkout online or over the phone
We’ll mail the official bond form via your preferred shipping method. Sign and include it in your license application packet.
Can I Get Bonded With Bad Credit?
This bond can be difficult to get with bad credit since it typically requires strong personal credit.
However, you may be able to qualify for the bond by providing additional personal and business financials for underwriting review.
How Do I Renew My Home Service Contract Provider Bond?
Virginia home service contract provider bonds last for one year. You must renew your bond annually on July 1st.
We’ll contact you starting in April with a renewal quote. Typically, all you need to do is pay the invoice to maintain coverage for another year.
The surety provider can cancel the bond at any time but must give at least 60-days notice.
How to Become a Home Service Contract Provider in Virginia
You must be registered to legally operate as a home service contract provider in Virginia.
To start the registration process, fill out this application form and mail it to the VDACS: Virginia Department of Agriculture and Consumer Services, PO Box 526, Richmond VA 23218-0526.
Include your surety bond form and the $300 application fee along with your application. You’ll also need to maintain a reserve account with at least 40% of the money you’ve earned through active contracts.
How Do I Renew My License?
Any home service contract providers that are unregistered but still operating will face a $100 fee every 30 days until they complete the renewal registration process.
To renew your registration, simply pay the $300 renewal fee and submit an audited financial statement. You’ll also need to maintain an active surety bond in the amount required by the VDACS.
