What is a landscape contractor bond?
Landscape contractor bonds are legally binding agreements between three parties: landscape contractors, the government agency responsible for regulating local landscaping services, and a surety company.
The government agency is the Obligee and establishes the obligations that the landscape contractor (the Principal) must follow. The surety (also called bonding company) issues the bond guaranteeing the performance of the landscaper.
Why do you need a landscape contractor bond?
Landscape contractor bonds are required in some states for eligibility to obtain a license to operate as a landscape contractor. Some states where you need a surety bond include Oregon and North Carolina.
When the surety company issues the bond, they provide the government agency a guarantee that the employers of a licensed landscape contractor will receive payment for financial losses resulting from a violation of the statutes and regulations set forth by the landscape contractor license.
If the contractor fails to meet the obligations set out by the government agency, the surety will pay out any damages up to the bond amount. The contractor is ultimately liable for the losses and is legally required to reimburse the surety company for any damages paid under the bond.
How much does a landscape contractor bond cost?
Landscape contractor surety bond costs vary depending on the total bond amount and the premium rate. The government agency sets the required bond amount which is usually based on the total value of the contractor’s projects. The surety company determines your premium rate, which is the percentage of the total bond amount you pay as the premium.
During the application process, the surety company evaluates your credit score, financial strength, and industry experience. Applicants with good credit generally receive the lowest rates, however, bad credit will not prevent you from securing a landscape contractor bond. EZ Surety still offers competitive rates to individuals with low credit scores or other financial issues.
Below are the lowest premiums EZ Surety has issued for landscape contractor surety bonds in popular states.
- EZ Surety has issued landscape contractor bonds in the State of North Carolina for premiums as low as $100.