Contractor License Bonds Broker
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All About Contractor License Bonds
You’re a professional insurance agent, ready for anything when it comes to your clients’ needs. Well, almost anything — when it comes to surety bond coverage like constructor license bonds, you might need a little professional help. That’s why BondExchange has you covered. Here’s what you might need to know about contractor license bonds, when and why your clients need them, and anything else necessary to get your clients the bonds they need.
What is a Contractor License Bond?
First things first: the definition of a contractor license bond. Contractor license bonds are a subset of surety bonds that are designed to protect the government agency that issues the contractor’s license and the consumers that utilize the contractors services. Contractors holding licenses in most of the west coast states, along with many cities or counties across the country, will need to purchase a surety bond to obtain or renew their license.
How Does a Contractor License Surety Bond Work?
Contractor license surety bonds work differently than other construction-related bonds. Unlike bid bonds or performance and payment bonds, contractor license bonds are used to ensure the contractor remains in general compliance with the statutes of their specific license. In comparison, contract-related bonds are designed to protect project owners only for specific projects.
As each state has different contractor license requirements, surety bonds for contractor licensing will cover different types of behavior and consequences. This makes it important for agents to understand the specific requirements of contractors on a state-by-state basis.
What’s the Cost of a Contractor License Bond?
The cost of a contractor’s license bond is typically a percentage of the amount of the bond. The exact percentage can and will differ depending on several factors related to both the personal and professional status of the contractor. Credit scores, financial statements, assets and liquidity, and overall business experience all play a role in determining the percentage a contractor will have to pay. In general, however, contractor license bond premium costs can be anywhere from 0.5% to 10% of the bond amount..
How to Get a Contractor License Bond
Contractor license bonds, like other surety bonds, are obtained through insurance companies and their agents that specialize in providing surety bond insurance. Agents approach contractor license bond companies and source quotes on behalf of their construction clients before presenting them to their clients for review. BondExchange represents over 30 different surety companies to provide contractor license bonds instantly online for any type of contractor or customer credit profile.
The process of sourcing a contractor license bond can be challenging for insurance agents that don’t specialize in surety. Understanding how these bonds work and the underwriting process enables agents to provide valuable guidance to their contractor clients, but it is also beneficial for agents to find skilled partners in sourcing any other construction-related bond.
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Why Partner with BondExchange for Contractor Licensing Bonds?
BondExchange has been working with insurance agents for over 40 years, building functional and fast technologies and specialty programs designed to make our agents work more efficiently. We know that most insurance agents do not focus on surety bonds such as contractor licensing bonds, so we’ve created a platform that makes the process simple, fast, and profitable
Simplifying the Bond Process with the Help of Straightforward Tools
Thanks to the straightforward tools we’ve designed, BondExchange has simplified the contractor licensing bond process. Agents find it easy to quote bonds quickly, deliver those quotes electronically, and issue bonds online. Our online application uses language that’s easy to understand for both agents and their end customers. Our system generates quotes instantly after taking just seconds to shop over 30 markets, offering online bond purchases with zero paperwork
You Deserve Customized, Expert Service
Our agents always come first here at BondExchange. Your name and brand is featured prominently, reinforcing your expertise and professional image with your clients at all times. With our professional underwriting staff, you’re always just a step away from the answers you need, whether it’s by phone, our website chat, or email. Our friendly, knowledgeable experts stand ready to help you through the bonding process.
Single Entry-Point Solution for Insurance Agents
BondExchange keeps it simple when it comes to providing access to hundreds of different types of bonds and rates from more than 30 different carriers. We offer a single entry-point to shop the entire surety market instantly online, putting your profitability and professional reputation first.