If you are starting a new business and becoming a contractor, you will most definitely need to get properly licensed and bonded. The bonding requirements will certainly differ depending on where it is that you are actually located and operating, but the bottom line is that you will need to carefully think about getting it in order to conduct your business properly and establish yourself as trustworthy and reliable.
I am quite certain that you want your potential clients to perceive you as trustworthy and reliable, which is why you won’t skip the step of getting your license and getting the right surety bond for you. Click this to get a better idea to get a better idea as to what surety is.
Now, if you are like most business owners, you will first want to learn a bit more about this entire idea of contractor bonds and about how much those precisely cost, before actually taking any concrete steps towards buying any of those. This is definitely understandable and it is quite a responsible thing to do, because learning about things before embarking on the actual journey shows that you are a responsible owner who wants to do what’s best for his or her business, which is quite commendable.
Yet, I wouldn’t advise you to wait for far too long to get these licenses and bonds, because not getting them might get you in trouble.
Since you most certainly don’t want to get in trouble, there’s no doubt that you will want to get this bond for you as soon as possible. Yet, as mentioned previously, you first want to get a completely clear idea as to how much this will cost you. If that’s what you want to learn about, then you have undeniably come to the right place, because it is precisely what we are going to talk about right now and thus help you make this decision as soon as possible and get your perfect surety bond.
How Much Does It Cost?
The first thing you will need to do is check the precise bond amount that your particular state will require you to get, if it is a requirement in the first place. I suppose you understand why this is important, because there is no point in getting a lower or an extremely higher amount if it isn’t necessary at all. These requirements will definitely vary from one state to another and I am pretty sure that you understand why checking it is rather important.
Once you start checking this out, you’ll see some rather varying amounts from state to state. In California, for instance, the contractors bond amount that you need to get is $15,000. In Nevada, however, that amount varies from $1000 to $500,000. You can clearly see that these are quite different, which just once again stresses the necessity of checking the correct amount in your state and then making sure to stay within the required range.
How Much Is That In Premiums?
Now that you know what to expect in your specific state, you are probably curious as to what this really means for you in terms of premiums, because you probably get it that you won’t be paying, say, $15,000 on a monthly basis if you are based in California. Premiums don’t really work that way and I assume you understand that. Instead, you are charged a percentage of the total bond amount as a premium, and that percentage will also be different not only from state to state, but from company to company as well.
Of course, there are a few more things that will have an impact on the amount of your premium. For starters, there is your personal credit score to keep in mind and think about, but you shouldn’t worry if it is not quite good, because you’ll certainly still manage to find a company to provide you with this bond even if you don’t have a good credit score.
Yet, the premium amount will be affected by it, just like it will be affected by your general level of experience, as well as any claims that might have been filed against a previous bond. Those are the factors that you’ll need to consider in order to determine how much this will cost you, or you can simply talk to the experts and get the precise amount.
