What is an Arizona Contractor License Surety Bond?
The Arizona Registrar of Contractors requires Arizona Contractor License Surety Bonds for contractors operating in residential and commercial sectors of the state. These surety bonds ensure the contractor’s adherence to all laws and regulations, including Arizona State, county and city building codes, as well as the regulations set by the Arizona Revised Statutes. They protect against a contractor’s abandonment of binding contractual agreements, and potential acts of fraud or misrepresentation. Arizona Contractor License Surety Bonds ensure the prompt and full payment of all applicable taxes and fees, as well as the provision of ethical, honest and safe service. If any of the conditions are violated, a claim may be placed against the bond.
How is the Arizona Contractor License Surety Bond amount calculated?
Arizona Contractor License Surety Bonds vary depending on the license classification and volume of work within the state of Arizona. Below is a list of License Types with Gross Volume and adequate Bond Amounts that comply with the revisions from July 1, 2014:
| License Type | Contemplated gross Volume (Per License) | Bond Amount |
|---|---|---|
| Residential General Contractors | Less than $750,000 | $9,000 |
| $750,000 or more | $15,000 | |
| Residential Specialty Contractors | Less than $375,000 | $4,250 |
| $375,000 or more | $7,500 | |
| Commercial General Contractors (Includes General Engineering Contractors) | $150,000 or less | $5,000 |
| In excess of $150,000 but not more than $500,000 | $15,000 | |
| In excess of $500,000 but not more than one million | $25,000 | |
| In excess of one million but not more than five million | $50,000 | |
| In excess of five million but not more than ten million | $75,000 | |
| Over ten million | $100,000 | |
| Commercial Specialty Contractors | $150,000 or less | $2,500 |
| In excess of $150,000 but not more than $500,000 | $7,000 | |
| In excess of $500,000 but not more than one million | $17,500 | |
| In excess of one million but not more than five million | $25,000 | |
| In excess of five million but not more than ten million | $37,500 | |
| Over ten million | $50,000 |
Note: Dual-license bond amounts are calculated by combining the amount required for Commercial and Residential license types.
If you have specific questions, feel free to contact one of our Contractor License Surety Bond experts at Pacific Surety!
What is the penalty for contracting without an Arizona Contractors license?
Operating without a valid Arizona Contractor License can result in harsh penalties. It is a Class 1 Misdemeanor to act/advise as a contractor or perform a contractor service for compensation if unlicensed. First time offences can result in fines and possible jail time. The Arizona Registrar of Contractors keeps record of all licensed contractors as a research tool for any potential clients to confirm current license status.
What is required to apply for an Arizona Contractor License?
In addition to an Arizona Contractor’s License Surety Bond, contractors need to provide the following items to the Arizona Registrar of Contractors to complete their submission:
- Contractor Examination Results
- The Qualifying Party must complete the AZ BME Business Management Exam and a specific trade exam, unless eligible for a waiver. They must pass these examinations by at least 70% and submit the results.
- Background Checks
- Papers for Legal Entity
- LLC’s and corporations are required to register with the Arizona Corporation Commission.
- Partnerships are required to register with the Arizona Secretary of State.
Fees (See Fee Schedule below)
| New License Application | ||||
|---|---|---|---|---|
| Classification | Application Fee | License Fee | Recovery Fund Assessment | Total |
| General Commercial (A, B-1, B-2) | $200 | $580 | $0 | $780 |
| Specialty Commercial (C) | $100 | $480 | $0 | $580 |
| General Residential (B, B-3, B-4, B-5, B-6, B-10) | $180 | $320 | $370 | $870 |
| Specialty Residential (R) | $80 | $270 | $370 | $720 |
| General Dual (KA, KB-1, KB-2) | $200 | $480 | $370 | $1,050 |
| Specialty Dual (CR) | $100 | $380 | $370 | $850 |
- Government issued ID
Applications can be mailed to the Registrar of Contractors at PO Box 6748, Phoenix, AZ 85005 or Hand Delivered to 1700 W. Washington Street, Suite 105, Phoenix, AZ 85007.
Can I get an Arizona Contractor License Surety Bond with bad credit?
Pacific Surety offers a wide range of approvals, regardless of credit, for Arizona Contractor License Surety Bonds. Whether it’s your initial bond or a renewal, our strong surety relationships help get your price down as low as possible! No need to shop your rate, we do that for you! If you have any specific questions feel free to contact our knowledgeable underwriting staff.
How much does an Arizona Contractor License Surety Bond cost?
Arizona Contractor License Surety Bonds are subject to underwriting and the price you will pay depends on a review of your personal credit report (soft check). Pacific Surety is proud to offer rates with qualifying credit starting as low as $75 annually.
It typically takes just a few hours from quote to issuance of the bond, and we have the ability to beat any competitors pricing. Approvals are available for applicants with less-than-perfect credit! If you have specific questions, feel free to contact one of our experts at Pacific Surety!
Can the premium for an Arizona Contractor License Surety Bond be financed?
Pacific Surety has an industry-leading premium finance program that gives our clients the ability to purchase a bond when the upfront costs might be prohibitive to them. Applicants who choose this option will pay a percentage of their premium as a down payment, and the balance of the premium will be paid in four (4) monthly installments. Please contact our staff for additional information regarding our finance program.
How do I get an Arizona Contractor License Surety Bond?
The first step is to complete our quick online application for your free, no obligation bond quote. Submission takes only five minutes, and our underwriting staff will be in contact with you within a couple of hours with pricing. If you prefer to speak with our knowledgeable staff, please call 1-866-722-7837 and one of our Underwriters will assist you in applying for your bond.
After you receive approval, you must sign an indemnity agreement with the surety and provide payment for your bond premium. In most cases, we can issue bonds the same day we receive your signed documents and payment.