Louisiana Contractor License Bond

Certain construction contractors working in the state of Louisiana need to have a license to do business legally. The licensing requirements may include the need for a Louisiana contractor license bond, depending on the type of work performed and the location of a project. Home improvement contractors, as well as commercial contractors in specific parishes and counties, must meet the Louisiana contractor license bond requirement to help ensure their customers are protected from fraudulent or illegal business practices.

A Louisiana contractor license bond is an agreement between three parties, like other surety bonds. These parties include the principal, which is the licensed contractor, the obligee, which is the local or state authority requiring the bond, and the surety company which provides the bond to the contractor. If a customer suffers financial losses due to incomplete or fraudulent work, a claim can be made against the bond for compensation.

Licensing requirements for Louisiana contractors vary from one city or county to the next. This means that Louisiana contractor license requirements also vary. Contractors working on projects that include electrical, mechanical, plumbing, or heating and air conditioning may need to get both a license and a contractor bond. On a state level, licenses are required for home inspection contractors, commercial contractors, residential contractors, and mold remediation contractors.

When a contractor in Louisiana is required to get a license in order to do business legally in the state, a Louisiana contractor license bond may also be necessary. Some local governments set the rules for licensing and bond, and those authorities then act as the obligee of the bond. Contractors may also need to acquire a surety bond on the state level if they cannot meet the minimum net worth requirements. For Louisiana contractor license bonds for the state, the obligee is the Louisiana State Licensing Board for Contractors, with contact information as follows:

Louisiana State Licensing Board for Contractors

600 North Street

Baton Rouge, Louisiana 70802

Phone: 225-765-2301

Local licensing authorities dictate the required amount of a Louisiana contractor license bond that must be posted. The bond amount ranges from $5,000 to $10,000 in most cases, but you are not responsible for the entire amount. Instead, bonds are priced as a small percentage of the total, typically between 1 and 10%.

The price you pay for a Louisiana contractor license bond relies heavily on your personal credit score. If you have bankruptcies, court judgments, or liens reported on your credit, you are seen as a higher risk to the surety company providing your bond. Higher risk bondholders pay a higher premium for a Louisiana contractor license bond.

If you are ready to obtain a Louisiana contractor license bond, you can complete the process easily by submitting an online application. The surety company will review your personal credit and business financials to determine the price of your bond, and then instructions on how to finish the process and post your bond.

Because local contractor license regulations vary, expiration dates and terms of licenses and accompanying surety bonds also vary. It is important to check with the local licensing authority to determine when a Louisiana contractor license bond may need to be renewed. For state licenses and Louisiana contractor license bonds, expiration is one year from the date the license was issued. Renewal instructions are sent from the surety company providing your bond.