How much does a contractor bond cost in South Carolina?
The South Carolina Department of Labor, Licensing and Regulation requires general and mechanical contractors to post a surety bond if they do not meet the minimum net worth requirements for their license classification. The required bond amounts are as follows:
- Group 1: $20,000
- Group 2: $80,000
- Group 3: $200,000
- Group 4: $350,000
- Group 5: $500,000
- Group 1: $7,000
- Group 2: $20,000
- Group 3: $40,000
- Group 4: $80,000
- Group 5: $400,000
The South Carolina Residential Builders Commission requires residential and specialty contractors to post a surety bond as part of the licensing requirements to operate in the state: The required bond amounts are:
Some cities and counties in the State of South Carolina require their own surety bonds. This includes North Augusta, Forest Acres, and Richland County.
The surety company issuing the bond 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 personal credit, financial statements, industry experience, and licensing history.
EZ Surety can issue premiums for South Carolina contractor license bonds for as low as 1% of the total bond amount for applicants with standard credit. If your credit is below average, we can still offer a competitive rate for your contractors license bond.
Why are contractor bonds important in South Carolina?
Contractor license bonds hold licensed contractors accountable for the quality of their work and protect the public from damages they’ve incurred due to the contractor’s violation of licensing laws.
When the surety company issues the bond, they provide a financial guarantee to the state or local municipality that the contractor will comply with the regulations set forth in the contractor license. If the contractor violates these regulations, causing a loss to the consumer, the consumer can file a claim against the bond.
If the claim is valid, the surety company will cover the costs to repair the damage up to the amount of the bond. The contractor is then liable to reimburse the surety company for all damages paid.
How do I get my general contractor’s license in South Carolina?
To obtain your general contractor’s license in South Carolina you must meet the Contractor Licensing Board licensing requirements by completing the following steps:
- Complete the license application form
- Register your business with the South Carolina Secretary of State
- Provide proof of general liability and workers’ compensation insurance
- Pass the business and law exam (and technical exam if necessary)
- Pay the $350 licensing fee
- Post the appropriate surety bond