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If you are a contractor doing business in the state of California, effective January 1, 2023, there will be a fee increase for contractor license bonds. The bond amount will increase from $15,000 to $25,000. The increase is a result of Senate Bill 607. California Contractor licensed bonds will automatically be increased by your surety agency starting January 2023. If you are a contractor operating in the state of California and you have not been contacted by your surety agent to discuss the fee increase, call The Surety Place to learn your bond options.
To operate as a contractor in California, contractors must first acquire a license and a surety bond. Contractors consist of any individual who installs, repairs, or builds any structure, but a contractor’s definition can vary based on the state.
There are a few exceptions to this general norm in most states, including:
Some jurisdictions only require specific contractors to acquire a surety bond, and the bond amount may vary depending on the contractor’s licensing class (residential, commercial, specialty etc). To learn whether or not you are required to obtain a California Contractor License Bond, visit the links below.
A contractor license bond is a type of surety bond that is used as a contract to guarantee your clients are protected from the work you provide. It is necessary to have a contractor license bond to obtain a contractor license. This type of license bond is beneficial for both you and your clients. It should always be obtained when any construction project is being completed because it protects anyone involved in the project from any unethical or costly business decisions or practices. When you have a contractor license bond, you are agreeing to follow all state laws and regulations in accordance with that state. The bond is an agreement between 3 parties, the contractor, the hiring company, and the surety, and is meant to protect all 3 parties in one way or another. When you apply for a contractor license bond, you are agreeing to provide professional and ethical services. This contractor bond is also meant to protect the public, ensuring that the work you provide for the hiring company will not harm civilians. The contractor license bond is essential for any contractor looking to provide ethical and quality work with an insurance and bond guarantee.
Without a contractor license bond, contractor work is not secure. When you obtain this bond, you are promising to follow a specific set of regulations and guarantee s certain caliber of work. If these standards are not met, a claim can be made on the bond, and the contractor’s license could be revoked. Some reasons a claim may be made on a bond include:
• Not paying taxes
• Failing to abide by every safety and labor law
• False advertisement
• Abandoning a contract after a bid is submitted or accepted
When working with The Surety place, we make the process as seamless as possible for you. We know how busy you are, and we want you to know that we do the hard work for you. You can apply online or call directly and one of our agents will be happy to assist you.