Skip to content
Contractor License Requirements

Contractor License Bond Requirements by State

A contractor license bond is a surety bond a state requires before it issues or renews a contractor license. Only 10 of the 51 jurisdictions require one for general or building contractors. Another 8 accept a bond in place of a financial test, and 26 have no statewide general contractor bond at all, although trade, city and nonresident bonds can still apply. This page shows the amount, who must file, the accepted alternatives and the official source for every state.

Find your stateWhat a bond costsDownload CSV

Page updated . Underlying guides were source-checked from through ; each state shows its own date. We do not sell bonds.

How states handle contractor license bonds

Bond rules fall into five models. The model matters more than the dollar figure: a state with no license bond may still test your finances, charge a recovery-fund fee or bond a specific trade.

ModelJurisdictionsWhat it means
License bond required10A surety bond (or an approved cash or account alternative) is a condition of the state license or registration. (Alaska, Arizona, Arkansas, California, District of Columbia, Nevada, New Jersey, New Mexico, Oregon, and Washington)
Bond as an alternative8The state tests finances, insurance or credit; a bond is one way to satisfy that test, or the board may require one. (Hawaii, Maryland, North Carolina, South Carolina, Tennessee, Utah, Virginia, and Wisconsin)
Recovery fund instead3General or building contractors pay into a state fund that compensates consumers instead of filing a license bond. (Connecticut, Massachusetts, and Minnesota)
Tax, wage, or nonresident bond4No license bond, but a bond can be required for nonresident contractors, state taxes or wages. (Delaware, Iowa, Oklahoma, and West Virginia)
No statewide contractor bond26No statewide license bond for general or building contractors. Trade, city or county bonds can still apply.

Contractor license bond amounts at a glance

The bond, or bond alternative, for general or building contractors. Select a state for the full rule, related trade bonds and sources.

StateGeneral contractor bondModel
AlabamaNo general contractor license bondNo statewide contractor bond
Alaska$25,000 general contractor; $20,000 residential-onlyLicense bond required
Arizona$9,000–$15,000 residential; $5,000–$100,000 commercialLicense bond required
Arkansas$10,000 Contractors Bond Law bondLicense bond required
California$25,000 contractor bond, plus qualifier and LLC bondsLicense bond required
ColoradoNo statewide general contractor bondNo statewide contractor bond
ConnecticutNo bond; Guaranty Fund fee insteadRecovery fund instead
DelawareNonresident tax bond: 6% of contracts of $20,000 or moreTax, wage, or nonresident bond
District of ColumbiaNo GC/CM bond; $25,000 home improvement bondLicense bond required
FloridaNo state license bondNo statewide contractor bond
GeorgiaNo general contractor license bondNo statewide contractor bond
HawaiiBoard may require at least $5,000Bond as an alternative
IdahoNo general contractor registration bondNo statewide contractor bond
IllinoisNo statewide general contractor bondNo statewide contractor bond
IndianaNo statewide contractor bondNo statewide contractor bond
IowaOut-of-state contractors: $25,000Tax, wage, or nonresident bond
KansasNo statewide contractor bondNo statewide contractor bond
KentuckyNo statewide contractor bondNo statewide contractor bond
LouisianaNo license bond; $50,000 net worthNo statewide contractor bond
MaineNo statewide contractor bondNo statewide contractor bond
MarylandBond only if solvency guidelines are not metBond as an alternative
MassachusettsNo bond; Guaranty Fund paymentRecovery fund instead
MichiganNo residential builder bondNo statewide contractor bond
MinnesotaNo bond for builders; trade contractors are bondedRecovery fund instead
MississippiNo general contractor license bondNo statewide contractor bond
MissouriNo statewide contractor bondNo statewide contractor bond
MontanaNo construction contractor bondNo statewide contractor bond
NebraskaNo registration or nonresident bondNo statewide contractor bond
Nevada$1,000 to $500,000, set by the license limitLicense bond required
New HampshireNo statewide contractor bondNo statewide contractor bond
New Jersey$10,000, $25,000 or $50,000 home improvement securityLicense bond required
New Mexico$10,000 code bondLicense bond required
New YorkNo state bond; NYC rules apply locallyNo statewide contractor bond
North Carolina$175,000 to $1,000,000 instead of working capitalBond as an alternative
North DakotaNo contractor license bondNo statewide contractor bond
OhioNo statewide bond; local bonds varyNo statewide contractor bond
OklahomaNonresident contracts over $100,000Tax, wage, or nonresident bond
Oregon$25,000 residential; $25,000 or $80,000 commercialLicense bond required
PennsylvaniaNo home improvement bondNo statewide contractor bond
Rhode IslandNo registration bondNo statewide contractor bond
South CarolinaGroup bond instead of financial statement; $5,000 residential specialtyBond as an alternative
South DakotaNo general contractor bondNo statewide contractor bond
TennesseeBond of 50% of the license limit instead of financialsBond as an alternative
TexasNo state bond; some cities require oneNo statewide contractor bond
UtahFinancial questionnaire or Commission-set bondBond as an alternative
VermontNo contractor bondNo statewide contractor bond
VirginiaClass A or B net worth, or a surety bondBond as an alternative
Washington$30,000 general; $15,000 specialtyLicense bond required
West VirginiaNo license bond; wage-bond complianceTax, wage, or nonresident bond
Wisconsin$25,000 bond or $250,000 liability insuranceBond as an alternative
WyomingNo statewide contractor bondNo statewide contractor bond

What a contractor license bond is, and what it is not

A license bond involves three parties. The contractor (the principal) buys it, the state (the obligee) requires it, and the surety promises to pay eligible claims up to the bond amount if the contractor breaks the licensing law. California’s board describes its bond as filed for the benefit of consumers damaged by defective construction or other license-law violations, and of employees who were not paid wages they are owed.

  • It is not insurance for the contractor. Liability insurance pays covered losses on the contractor’s behalf. With a bond, the contractor normally signs an indemnity agreement and must repay the surety for claims it pays, plus costs.
  • It is not per job. California’s $25,000 bond is the total available for all of a contractor’s jobs during the life of the bond. When claims use it up, the contractor must buy a new bond to keep the license in effect.
  • It is not a project bond. Bid, performance and payment bonds guarantee a specific contract and are set by the project owner. Our surety bonds guide explains the difference.
  • It is not always the only financial requirement. Nevada and Arizona scale the bond with the license limit or annual volume, and states such as North Carolina, South Carolina and Virginia let a bond replace a working-capital or net-worth test.

How much a contractor license bond costs

The bond amount is the most the surety will pay on claims, set by the state. The premium is what you pay the surety, usually each year. A $25,000 bond does not cost $25,000.

No state regulator publishes premium rates, and the figures on bond-seller websites are unsourced marketing estimates. Sellers commonly advertise premiums from under 1% to about 5% of the bond amount for applicants with good credit, and higher rates or collateral for weak credit or past claims. Treat any percentage as a starting point for questions, not a price. The arithmetic below shows what round rates would mean for amounts states actually require.

Annual premium at illustrative rates. Arithmetic only, not a quote.
Bond amountWhere it appliesAt 1%At 3%At 5%
$10,000Arkansas; New Mexico; New Jersey minimum$100$300$500
$15,000Washington specialty; Arizona residential at $750,000+$150$450$750
$25,000California; Alaska; Oregon residential$250$750$1,250
$30,000Washington general contractor$300$900$1,500
$80,000Oregon commercial Level 1$800$2,400$4,000

Premium for the term: $500. Enter the rate from a written quote; New Mexico, for example, requires the bond to cover the full three-year license term.

Before you buy, ask each surety for the premium on the exact official form and amount, the term and renewal price, whether it renews automatically, whether collateral is required and what the indemnity agreement requires you to repay. A quote on the wrong form or business name can delay your license: California requires the bond’s business name and license number to match the board’s record exactly.

Alternatives to a surety bond

Bond sellers rarely mention it, but several states accept cash or an account instead of a surety bond. Cash avoids premiums and credit underwriting but ties up the full amount, sometimes long after you stop contracting.

  • California: a cashier’s check filed with CSLB instead of the $25,000 surety bond.
  • Nevada: a cashier’s check for the full bond amount, with a $200 biennial administrative fee. The Board holds the deposit for two years after the license ends or the bond requirement is lifted.
  • Washington: an assigned account on L&I’s form, using cash, a certificate of deposit, time deposit or money market account at a bank, savings and loan or credit union with a Washington branch.
  • Alaska and Arkansas: authorized cash deposits or cash bonds.
  • Letters of credit: New Jersey accepts an irrevocable letter of credit for its home improvement security, North Carolina for its landscape contractor bond, and Louisiana uses one to cover a net-worth shortfall.
  • Qualifier and LLC bonds. California requires a separate $25,000 bond of qualifying individual for responsible managing employees and some other qualifiers, and a $100,000 employee/worker bond for LLC licensees.
  • Recovery and guaranty funds. Connecticut, Massachusetts, and Minnesota charge contractors a fund fee instead of a bond. Arizona charges a residential recovery-fund assessment on top of its bond, and Maryland’s Guaranty Fund assessment is not a bond.
  • Financial-responsibility bonds. In Hawaii, Maryland, North Carolina, South Carolina, Tennessee, Utah, Virginia, and Wisconsin, a bond is one way to meet a financial, insurance or credit test, and the amounts can be far larger than a typical license bond. North Carolina’s Unlimited license accepts a $1,000,000 bond in place of $150,000 of working capital.
  • Tax, wage and nonresident bonds. Delaware and Oklahoma require tax bonds from nonresident contractors on larger contracts, Iowa requires a $25,000 bond from out-of-state contractors, and West Virginia requires wage-bond compliance.
  • Local bonds. Cities and counties set their own: Columbus, Ohio requires a $25,000 bond for general contractor registration, El Paso a $50,000 blanket construction bond, and New York City a $20,000 bond or Trust Fund enrollment for home improvement contractors.

Contractor license bond requirements by state

Each entry covers general or building contractors first, then other trades with a state bond in our guides. Follow the guide for the complete requirements and cited primary sources.

Showing 51 jurisdictions

Alabama contractor license bond

No general contractor license bond · No statewide contractor bond

The general contractor board relies on a CPA or approved accountant’s financial statement instead of a license bond. Two trade boards do require bonds.

  • HVAC: Active heating and air conditioning contractors: $20,000 performance bond naming the Board as obligee
  • Roofing: Residential roofer license: $10,000 bond

Alabama general contractor guide · Alabama Licensing Board for General Contractors · Checked 2026-09-04

Alaska contractor license bond

$25,000 general contractor; $20,000 residential-only · License bond required

Every registered contractor files a bond with the registration. General contractors post $25,000, or $20,000 if they hold the residential endorsement and work exclusively on residential projects. Mechanical and specialty contractors post $10,000 and handymen $5,000. The prescribed surety bond or an authorized cash deposit is accepted.

Alaska general contractor guide · CBPL — contractor FAQs and classification/bond guidance · Checked 2026-09-04

Arizona contractor license bond

$9,000–$15,000 residential; $5,000–$100,000 commercial · License bond required

AZ ROC bonds scale with the classification and the contractor’s anticipated annual Arizona volume. A residential general contractor posts $9,000 below $750,000 of volume and $15,000 at $750,000 or more; commercial amounts run from $5,000 to $100,000, and a dual license combines both. Residential and dual contractors also pay the Residential Contractors’ Recovery Fund assessment or post an alternative $200,000 bond.

Arizona general contractor guide · AZ ROC — bond information · Checked 2026-09-04

Arkansas contractor license bond

$10,000 Contractors Bond Law bond · License bond required

Arkansas’s Contractors Bond Law requires a $10,000 surety or cash bond before a contractor begins work, executed through an agent licensed by the Arkansas Insurance Department. Commercial applicants may also be able to file a bond in lieu of the commercial financial statement.

Arkansas general contractor guide · Arkansas Contractors Licensing Board · Checked 2026-09-04

California contractor license bond

$25,000 contractor bond, plus qualifier and LLC bonds · License bond required

Every active CSLB license, in every classification, files a $25,000 contractor bond on CSLB’s form or an approved alternative such as a cashier’s check. A separate $25,000 bond of qualifying individual can apply to an RME and to some RMO or LLC qualifier arrangements. LLCs also maintain a $100,000 employee/worker bond. The bond’s business name and license number must match the CSLB record exactly.

  • Pest Control: Structural pest control company registration: $12,500 bond

California general contractor guide · CSLB: A Guide to Contractor License Bonds · Checked 2026-09-04

Connecticut contractor license bond

No bond; Guaranty Fund fee instead · Recovery fund instead

Home improvement contractor registration costs $220 a year, of which $100 is the Home Improvement Guaranty Fund fee. New home construction registration includes a $240 New Home Construction Guaranty Fund fee. Neither registration requires a surety bond; both require at least $20,000 of general liability insurance.

Connecticut general contractor guide · Connecticut Department of Consumer Protection — Occupational and Professional Licensing Division · Checked 2026-09-04

Delaware contractor license bond

Nonresident tax bond: 6% of contracts of $20,000 or more · Tax, wage, or nonresident bond

Delaware has no contractor license bond. A nonresident contractor or subcontractor generally posts a tax bond equal to 6% of each contract of $20,000 or more, including under the annual aggregate rule. The Department of Finance may waive it in whole or in part.

Delaware general contractor guide · 30 Del. C. § 375 — bonds by foreign persons or firms · Checked 2026-09-04

District of Columbia contractor license bond

No GC/CM bond; $25,000 home improvement bond · License bond required

The General Contractor/Construction Manager license has no bond requirement in DLCP’s current list. A Home Improvement Contractor endorsement requires a $25,000 bond, and the District’s trade contractors and designated masters file their own bonds.

  • Electrician: Electrical contractor company: $4,000; designated regular-voltage master: $2,000
  • Plumber: Master plumber and plumbing trade contractor bonds required

District of Columbia general contractor guide · DLCP Home Improvement Contractor surety-bond details · Checked 2026-09-04

Florida contractor license bond

No state license bond · No statewide contractor bond

The CILB does not require a license bond. Applicants prove financial responsibility with a credit report: a FICO-derived score of 660 or higher with no unsatisfied judgments or liens qualifies, and an individual applicant below that standard completes a CILB-approved 14-hour financial-responsibility course instead. Counties and cities can impose their own bonds for local registration or permits.

Florida general contractor guide · Florida Construction Industry Licensing Board (within the Department of Business and Professional Regulation) · Checked 2026-09-04

Hawaii contractor license bond

Board may require at least $5,000 · Bond as an alternative

Applicants file a compiled, reviewed or audited financial statement and credit reports. The Board may require a bond of at least $5,000 after considering the applicant’s financial condition and field experience, so not every contractor posts one.

Hawaii general contractor guide · HRS 444-11.1 and 444-16.5 — insurance and bond · Checked 2026-09-04

Idaho contractor license bond

No general contractor registration bond · No statewide contractor bond

Contractor registration has no bond. Public works licensing uses class-based net-worth and working-capital guidelines, and several trade credentials require their own bonds.

  • Plumber: Plumbing contractor: $2,000 bond
  • HVAC: HVAC contractor: $2,000 compliance bond
  • Fire Sprinkler: Fire protection sprinkler contractor: $2,000 bond
  • Septic Contractor: Septic installers: $10,000 basic, $30,000 complex

Idaho general contractor guide · Idaho Division of Occupational and Professional Licenses · Checked 2026-09-04

Iowa contractor license bond

Out-of-state contractors: $25,000 · Tax, wage, or nonresident bond

Contractor registration has no bond for Iowa contractors. An out-of-state contractor generally files a $25,000 bond from a surety authorized in Iowa, or a statement that it is prequalified to bid Iowa DOT projects. The bond secures state taxes, penalties and other payments owed to Iowa agencies.

  • Plumber: Plumbing contractor license: $5,000 bond
  • HVAC: Mechanical contractor license: $5,000 bond

Iowa general contractor guide · Iowa Department of Inspections, Appeals, and Licensing · Checked 2026-09-04

Louisiana contractor license bond

No license bond; $50,000 net worth · No statewide contractor bond

Commercial and residential applicants file an LSLBC financial statement showing at least $50,000 of net worth instead of a license bond. An irrevocable letter of credit may make up a shortfall.

  • Pest Control: Structural pest control business permit: $2,000 surety or fidelity bond

Louisiana general contractor guide · Louisiana State Licensing Board for Contractors · Checked 2026-09-04

Maryland contractor license bond

Bond only if solvency guidelines are not met · Bond as an alternative

MHIC reviews each applicant’s financial solvency. An applicant that does not meet the guidelines may qualify with a surety bond or an indemnitor. Licensees also pay Home Improvement Guaranty Fund assessments, which are not a bond.

Maryland general contractor guide · Maryland Home Improvement Commission · Checked 2026-09-04

Minnesota contractor license bond

No bond for builders; trade contractors are bonded · Recovery fund instead

For residential building contractors and remodelers, the Contractor Recovery Fund replaces bonding: the fee is $320, $420 or $520 depending on gross annual receipts. Minnesota’s trade contractor licenses are bonded separately.

Minnesota general contractor guide · Minnesota Department of Labor and Industry · Checked 2026-09-04

Nevada contractor license bond

$1,000 to $500,000, set by the license limit · License bond required

Every NSCB license carries a monetary limit based on the applicant’s financial statement, and the Board sets a bond scaled to that limit before issuance: from $1,000 at the $15,000 minimum limit up to $500,000 for an unlimited license. A cashier’s check for the full amount can replace the surety bond. The bond must stay current at every renewal.

Nevada general contractor guide · Nevada State Contractors Board: Bonds · Checked 2026-09-04

New Jersey contractor license bond

$10,000, $25,000 or $50,000 home improvement security · License bond required

Every home improvement contractor business maintains additional security: a compliance bond, irrevocable letter of credit, or other security the Division accepts. The minimum is $10,000 for smaller contracts and volume, $25,000 for the middle tier, and $50,000 for contracts over $120,000 or prior-12-month volume of $750,000 or more.

  • Electrician: Electrical contracting business permit: $1,000 bond
  • Plumber: Master plumber: $3,000 bond

New Jersey general contractor guide · New Jersey Division of Consumer Affairs · Checked 2026-09-04

New Mexico contractor license bond

$10,000 code bond · License bond required

CID requires a $10,000 corporate-surety code bond in the business’s exact licensed name. It must cover the full three-year license term and be replaced or continued at renewal. The guides for New Mexico’s building, electrical and mechanical classifications record the same $10,000 amount.

New Mexico general contractor guide · New Mexico Regulation and Licensing Department — Construction Industries Division · Checked 2026-09-04

New York contractor license bond

No state bond; NYC rules apply locally · No statewide contractor bond

New York has no state general contractor license. In New York City, a home improvement contractor joins the DCWP Trust Fund for $200 or posts a $20,000 surety bond. The city’s $25,000 general contractor condition is proof of financial solvency through bank statements, not a bond.

New York general contractor guide · Local building and contractor licensing authority · Checked 2026-09-04

North Carolina contractor license bond

$175,000 to $1,000,000 instead of working capital · Bond as an alternative

Each license limit has a financial test that a surety bond can replace: Limited, $17,000 of working capital, $80,000 of net worth, or a $175,000 bond; Intermediate, $75,000 of working capital or a $500,000 bond; Unlimited, $150,000 of working capital or a $1,000,000 bond.

  • Landscaping: Landscape contractor: $10,000 bond or irrevocable letter of credit

North Carolina general contractor guide · North Carolina Licensing Board for General Contractors · Checked 2026-10-26

Ohio contractor license bond

No statewide bond; local bonds vary · No statewide contractor bond

Ohio has no state general contractor license. Cities set their own requirements; Columbus, for example, requires a $25,000 bond for its general contractor registration.

  • Septic Contractor: Sewage treatment system contractors: bond required by each health district where registered

Ohio general contractor guide · Ohio Construction Industry Licensing Board · Checked 2026-09-04

Oklahoma contractor license bond

Nonresident contracts over $100,000 · Tax, wage, or nonresident bond

Oklahoma has no state general contractor license. The Oklahoma Tax Commission requires a nonresident contractor to post a bond for a contract over $100,000; Packet N and Form BT-163 set the amount and any waiver.

  • Electrician: Electrical contractor: $5,000 CIB bond
  • Plumber: Plumbing contractor: $5,000 CIB bond
  • HVAC: Mechanical contractor: $5,000 CIB bond

Oklahoma general contractor guide · Oklahoma Construction Industries Board · Checked 2026-09-04

Oregon contractor license bond

$25,000 residential; $25,000 or $80,000 commercial · License bond required

CCB requires a continuous surety bond matched to each endorsement: $25,000 for a residential general contractor, $80,000 for a Level 1 commercial general contractor and $25,000 for Level 2. A contractor with both endorsements carries both bonds.

  • Painting: Residential specialty contractors in our guides: $20,000

Oregon general contractor guide · CCB — license requirements, examination, insurance, bonds, and fees · Checked 2026-09-04

South Carolina contractor license bond

Group bond instead of financial statement; $5,000 residential specialty · Bond as an alternative

Commercial general contractors meet a working-capital or net-worth test for their license group, from Group 1 ($100,000 per job) to Group 5 (unlimited), or file a continuous surety bond for the group instead. Residential specialty contractors post a $5,000 bond when labor and materials for a job exceed $5,000.

  • Roofing: Residential roofing registration: $5,000 bond above $5,000
  • Painting: Residential painter/wallpaper registration: $5,000 bond above $5,000

South Carolina general contractor guide · South Carolina Contractor's Licensing Board · Checked 2026-09-04

Tennessee contractor license bond

Bond of 50% of the license limit instead of financials · Bond as an alternative

Contractor licenses rely on a reviewed or audited financial statement. Since July 1, 2026, the Board also accepts an approved surety bond equal to at least 50% of the requested monetary limit as an alternative.

  • Handyman: Home improvement contractor: $10,000 bond
  • Fire Sprinkler: Fire sprinkler contractor: $10,000 bond or qualifying Board certificate

Tennessee general contractor guide · Tennessee Board for Licensing Contractors — Department of Commerce and Insurance · Checked 2026-09-04

Texas contractor license bond

No state bond; some cities require one · No statewide contractor bond

Texas has no state general contractor license. Cities set their own registration terms; El Paso, for example, requires a $50,000 blanket construction bond and $100,000 of general liability insurance.

Texas general contractor guide · No statewide general contractor licensing agency · Checked 2026-09-04

Washington contractor license bond

$30,000 general; $15,000 specialty · License bond required

Every registered contractor keeps a continuous bond or a qualifying assigned savings account: $30,000 for a general contractor and $15,000 for a specialty contractor, for registrations and renewals on or after July 1, 2024. Several trade licenses add their own bonds.

  • Electrician: Electrical contractor: $4,000 bond or assigned savings
  • Plumber: Plumbing contractor: $6,000 bond or assigned savings
  • Fire Sprinkler: Fire sprinkler contractor: $10,000 ($6,000 for 13D/13R only)

Washington general contractor guide · Washington L&I: Register as a contractor · Checked 2026-09-04

West Virginia contractor license bond

No license bond; wage-bond compliance · Tax, wage, or nonresident bond

West Virginia’s contractor license has no license bond or financial-statement requirement, but the applicant must certify compliance with the state’s wage-bond requirements before issuance.

West Virginia general contractor guide · West Virginia Contractor Licensing Board · Checked 2026-09-04

Wisconsin contractor license bond

$25,000 bond or $250,000 liability insurance · Bond as an alternative

A Dwelling Contractor meets financial responsibility with general liability insurance of at least $250,000 per occurrence or a bond of at least $25,000. A restricted route accepts a bond from $5,000 to under $25,000 but caps the cost of each job at the bond amount.

Wisconsin general contractor guide · Wisconsin Department of Safety and Professional Services · Checked 2026-09-04

How to get a contractor license bond

  1. Confirm the requirement. Find your state above, then check the guide and the regulator’s current instructions for the amount that applies to your classification, volume or license limit.
  2. Get the official form. Many states require their own bond form or electronic filing by the surety. Washington, for example, requires the bond number and exact business name.
  3. Match the principal exactly. The business name, entity type and license or application number must match the license record.
  4. Compare quotes or a cash alternative. Ask about the term, renewal, collateral and indemnity, and price the cash or account option where your state allows one.
  5. File it and verify. Confirm that the regulator has recorded the bond before you start work, and keep it continuously in force through every renewal.

When someone files a claim

Using California’s published process as an example: a claimant contacts the contractor’s surety in writing with a description of the problem, the contract and supporting documents. If the claimant is not satisfied with the surety’s response, they can sue the contractor in small claims court for up to $10,000 or in superior court above that. Eligible claimants include homeowners harmed by a license-law violation, people harmed by fraud or willful violations in a construction contract, unpaid employees and unpaid fringe-benefit funds.

A contractor who receives notice of a claim should respond to the surety promptly with its position and documents. The surety investigates the claim and the board investigates any complaint, separately. A paid claim reduces the bond, must normally be repaid under the indemnity agreement and can raise future premiums.

Methodology and limitations

We started with the 51 general contractor guides in this site’s licensing dataset and read the bond, insurance and financial-responsibility requirements each one records from its regulator’s statutes, rules and application materials. We classified each jurisdiction into one of five models by hand and wrote the summaries above. We did not treat every recorded dollar figure as a license bond: several are optional alternatives to insurance or a financial statement. Trade bonds are listed only where our trade guides record them, so the lists are not exhaustive.

This page covers state license and registration bonds. It does not cover project bonds, public-works bonds or every city and county requirement. Bond amounts change by statute and rule, so confirm the current amount with the regulator before you buy.

Frequently asked questions

What is a contractor license bond?

A contractor license bond is a surety bond that a state requires before it issues or renews a contractor license or registration. The contractor buys it, but it protects the public: the surety promises the state that it will pay eligible claims, up to the bond amount, if the contractor violates the licensing law. In California, for example, homeowners, fraud victims, and unpaid employees can claim against it.

How much does a contractor license bond cost?

You pay a premium, not the bond amount. No regulator publishes premium rates. Surety sellers commonly advertise premiums from under 1% to about 5% of the bond amount per year for applicants with good credit, and more for weak credit, but those are marketing figures. On a $25,000 bond, each 1% of premium is $250 a year. Get written quotes on the exact official form and confirm the term.

Which states require a contractor license bond?

In our 51-jurisdiction comparison, 10 require a license bond for general or building contractors: Alaska, Arizona, Arkansas, California, District of Columbia, Nevada, New Jersey, New Mexico, Oregon, and Washington. Another 8 accept a bond as an alternative to a financial, insurance or credit requirement. Many other states require bonds only for specific trades, nonresident contractors or local registration.

Is a contractor license bond the same as insurance?

No. Liability insurance protects the contractor against covered losses. A license bond protects consumers and other claimants, and the contractor generally signs an indemnity agreement promising to repay the surety for any claim it pays. Many states require both.

Is the bond amount per job?

Generally no. California’s board states that its $25,000 bond is the amount available for all of a contractor’s jobs during the life of the bond, not per job. Once the bond is used up, the contractor must buy a new one for the license to remain in effect.

How does someone file a claim against a contractor license bond?

The claimant usually contacts the contractor’s surety in writing with a description of the problem, the contract and supporting documents. The license record or the regulator can identify the surety. In California, a claimant who is not satisfied with the surety’s response can sue in small claims court for up to $10,000 or in superior court above that. Other states use their own procedures, and recovery-fund states route claims through the fund.

Can I post cash instead of buying a bond?

In several states, yes. California accepts a cashier’s check, Nevada accepts a cashier’s check for the full bond amount with a $200 biennial fee and holds it for two years after the license ends, Washington accepts an assigned savings account, certificate of deposit or similar account at a bank with a Washington branch, and Alaska accepts authorized cash deposits. Cash ties up the full amount but avoids premiums and credit underwriting.

Can I get a contractor license bond with bad credit?

Usually, but expect a higher premium or collateral, because sureties underwrite on credit and claims history. Where a state accepts a cash deposit or assigned account, that route avoids credit underwriting. Some states do not use a bond at all: Florida, for example, uses a credit-score standard and requires a financial-responsibility course for individual applicants who do not meet it.

Do LLCs, qualifiers or subcontractors need their own bond?

Where the bond is a condition of the license, every licensee files one, including subcontractors with their own license. California adds separate bonds: a $25,000 bond of qualifying individual for responsible managing employees and some other qualifier arrangements, and a $100,000 employee/worker bond for LLC licensees.

What happens if my bond is cancelled or lapses?

Because the bond is a condition of the license, a cancelled, expired or exhausted bond generally means the license cannot remain active until a replacement is filed. Bond forms commonly require the surety to give the regulator advance notice before cancelling; Iowa’s plumbing contractor bond, for example, requires 10 days’ written notice. Check the notice period and reinstatement rules in your state guide.

Found a changed bond amount or a better primary source? Send a correction with the official source.

Related articles