4 Tips to Save Hundreds on Your Contractor License Bond

Learn some of these lesser known tips to save your hard earned money when shopping for your contractor license bond.

#1: Fix Your Personal Credit

The first item that’s looked at to determine your contractor license bond cost is your personal credit, so you’ll want to be sure to pay off any liens, collections, judgments or past due child support. If you leave any of these items on your credit report, the surety company will see them as a negative indication of how you’ll handle your contracting business, and as an increased surety credit risk. Remember, the surety bond is a form of credit provided to you by the surety company that guarantees you’ll pay any bond claims that you cause by breaking the law or conducting your business unprofessionally. Credit issues will cast you and your company in a bad light.

How to Get the Lowest Rates

#2: Find the Right Bond Agency

Choosing the right agency for your bonding needs can provide lower costs and a higher likelihood of getting approved. How? Larger bond agencies are usually able to negotiate flexible underwriting with surety companies, allowing for lower prices for your bond and the ability to get contractors approved when other agencies cannot. When it comes to getting your business bonded as quickly as possible, only a few bond agencies in the country can provide true instant online bond approvals. Even less have the ability to approve contractor license bonds in-house, making the process much faster as the wait for your bond approval from the surety company is eliminated.

#3: Become a U.S. Citizen

Your contracting business will benefit from you being a U.S. citizen. When you are a U.S. citizen, it shows the surety company that you plan on establishing and running your business for years to come, and are not a fly-by-night company. Without U.S. citizenship, the surety company will view you and your business as a higher risk simply because you have no physical ties to the U.S. that would keep you here to pay any bond claims that you may cause.

#4: Provide Strong Experience and Financials

After your personal credit, your business financials and industry experience are the next most important items that are reviewed by surety companies when determining your bond costs. If you run a profitable business and have the business financials to prove it, the potential of you causing bond claims through unprofessional business practices is lower, resulting in cheaper prices. Also, if you establish a respected contracting business and have substantial industry experience under your belt, the surety company will be more comfortable and willing to offer lower bond costs to a business they view as a responsible and experienced one.


Eric is an industry expert that specializes in taking complex surety concepts and explaining them in terms that make sense to the general public. He also manages the JW Surety Bonds website and works with various partners to help further educate the public on suretyship using various mediums.

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