Specifically designed for contractors and builders, contractor license bonds are a type of surety bound. Contractors are required to carry a contractor license bond to obtain and keep their licenses, in most states. Contractor license bonds are designed to protect consumers and employees who are owed unpaid wages. They ensure that contractors operate in compliance with local and state laws.
Contractor Bonds
Insurance companies typically issue contractor license bonds, which serve as a contract between the surety, the contractor and the client. Contractor license bonds are fully indemnified. If a surety on behalf of a contractor pays out a claim to the obligee, the amount of the claim is the responsibility of the contractor.
Like most other commercial surety bonds, contractor license bonds are underwritten. The contractor’s credit score and existing claims on his license determine the license bond premiums. In some cases, like bankruptcy or a newly licensed contractor, a surety company may ask for personal and company financial statements to determine the cost of the premiums.
In most instances, contractors and construction professionals are required to carry surety bonds. When you need to get to work, you need a bond fast. We can help get you the contractor bonds that fit your needs, so you can focus on getting the job done and building your future.
Types of Bonds
A surety bond is your word. When you obtain a contractor bond, you’re entering into a legal obligation that guarantees you’ll perform your work according to your contract while adhering to the rules and regulations of your contractor license.
License Bond
Get your license bond quickly so you can obtain or maintain your contractor license. A license bond is required in most states, and it’s your guarantee that you won’t violate any state law regulations.
Bid Bond
Bid bonds are intended to keep frivolous bidders out of the bidding process by guaranteeing that the successful bidder will enter the contract and provide the required contract bonds. Bid bonds keep the bidding process fair for everyone.
Performance Bond
Contractor performance bonds ensure you’ll live up to your end of a contract and complete construction in the time and manner agreed upon. Also known as a contract bond, performance bonds are required by law for public construction projects.
Payment Bond
Contractor payment bonds protect subcontractors, laborers, and materials suppliers against non-payment. Payment bonds are also a type of contract bond required by law for work on public projects.
Contractor bonds protect your reputation by ensuring you honor your commitments and contracts, and in most instances are a necessity for obtaining your license. We can get you the necessary bonds for your needs, so you can get to work fast.
McGovern Insurance is an experienced insurance and bonding agency that understands contractor license bonds. Call us at (650) 593-8216.