Contractors Insurance | California Contractor Bonds | Contractors Bonding and Insurance Company





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Streamed live on May 22, 2015

Need a California Contractor Bond? Call Us Today (800) 409-7944

What Is a California Contractors Bond?

When it comes to running an exceptional contractors business, it is extremely important to make sure you are following all the proper rules and regulations that the state has. The state of California is no exception. If you want to get into the construction business in the state of California then you must get properly licensed, insured, and bonded.

Basically being bonded means that a professional is offering the protection necessary under law to make sure that someone who hires a contractor for a project doesn't get into serious trouble because the original contractor, for whatever reason, cannot or will not finish the project. When a contractor is bonded that means they have what is called a surety bond from a surety company. When the contractor can't come through, the surety company is then responsible to help complete the contract or else compensate the project owner.

This offers two potential levels protection so that an individual is not in trouble if something happens. The failure to finish a contract can happen for several reasons. Sometimes this may happen because the contractor is far too overbooked, but this can also be the result of something beyond the contractor's control such as a severe illness, financial problems leading to bankruptcy, or even death.

A California contractors bond is a bond that is specifically good only in the state of California. Most states have this type of rule, meaning that for a company to do work in more than one state they must have more than one bond, as well. Some states require a contractor to be bonded, while others only require them to be licensed and insured. Generally speaking, you want to make sure you get a contractor that does have that surety bond because that provides a safety net for you.

The important thing to understand is that these bonds are generally limited in scope. Three of the most common amounts are for $100,000; $150,000; or $200,000. These are the types of amounts you often see for residential construction, or very small scale commercial. For much larger jobs for specialty contractors who can build skyscrapers or malls or other large-scale work, the numbers become much different.

Getting an excellent bond can be challenging for some businesses. The truth is, credit score and past experience in the industry makes a huge difference. This means that contractors who have a bad credit score, or who have not been working on their own for a long time will probably have to pay larger premiums for the proper bond. There are certain surety companies that specifically work with new construction companies and companies with bad credit in order to help them get properly bonded.

California is one of the states that requires its contractors to be bonded, making this an issue that cannot be ignored by a professional construction specialists. On the plus side, with so many companies specializing in this area there are many different options to choose from.

Anyone doing work in the state of California needs to have a contractors bond. While it is up to the contractors to make sure that they are properly bonded, is also up to the homeowner or potential business owner to do their homework and confirm that their professional is in fact bonded. It does not take a lot of work to find this information, as a simple online search and if you phone calls can clear up any potential worries, or confirm the worst in some cases.

There is no question that a California contractors bond remains an important part of any construction discussion.

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Contractors Insurance
Insurance Bond
Contractors Bonding and Insurance Company
Contractors Liability Insurance California

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