Virginia requires most contractors to be licensed by the state and to either provide a Virginia Contractor License Bond OR meet certain financial requirements. Learn more about these License Bonds including what they guarantee and how to easily obtain one.
A Virginia Contractor License Bond guarantees that a contractor will comply with Chapter 11 (§ 54.1-1100 et seq.) of Title 54.1 of the Code of Virginia. The bond guarantees that a licensed contractor will comply with all laws, ordinances, codes and rules of construction for the Commonwealth of Virginia.
If the contractor does violate a law or code, a claim can be made against the Virginia Contractor License Bond. A claim can be brought to the state on behalf of an injured party. The Surety Bond company will then have to pay the claim. In turn, the bond company will seek reimbursement from the licensed contractor on the bond.
The license bond benefits the public because it is easier to collect damages from a licensed surety company than trying to recover from the contractor through legal proceedings.
Generally, anyone doing contracting work in the Commonwealth of Virginia will need to be licensed by the state. Licensing is overseen by the Department of Professional and Occupation Regulation through the Board of Contractors (the Board). There are a few different categories of Virginia contractor licenses depending on the amount of contracted work. These include class A, B and C Contractors.
A Class A license in Virginia is for any contractor who has a single project value of $120,000 or more, OR the total value of all projects within any 12-month period is $750,000 or more.
Read more about Virginia Class A licensed contractor requirements.
A Class B license in Virginia is for any contractor who has a single project value of $10,000 or more, but less than $150,000, or the total value of all projects within any 12-month period is $150,000 or more, but less than $750,000.
Read more about the Virginia Class B licensed contractor requirements.
A Class C license in Virginia is for any contractor who has a single project value of $1,000 or more, but less than $10,000, or the total of all construction projects within any twelve-month period is less than $150,000.
Read more about Virginia Class C licensed contractor requirements.
Virginia Class C Licensed Contractors are not required to provide a Virginia Contractor License Bond or provide a financial statement to the Board at this time, unless specified by the Board.
Virginia Contractor License Bonds can be purchased instantly online at Axcess Surety. These contractor license bonds can be purchased without a credit check or indemnity agreement in some cases. The applicant only needs to complete a few basic questions, purchase and print their bond.
Virginia Contractor License Bonds can be purchased online for about 1% of the required bond amount. This amount will be due annually for each year that the license bond is in place. Some bond companies do provide discounts of up to 30% for contractors who purchase multiple years in advance. Better pricing may also be available for contractors who are financially strong and willing to provide financial statements.
Virginia Contractor License Bonds must be continuous. This means they need to be in place as long as the contractor maintains a License in Virginia.
The license bond can be canceled by the surety bond company. The surety bond company will need to provide thirty (30) days written notice to the Department of Professional and Occupational Regulation, at 9960 Mayland Drive, Suite 400, Richmond, Virginia 23233. The cancellation will not relieve the surety of any claims that took place while the bond was in force, or during the thirty-day cancellation period.
Although the amount of a Virginia Contractor License Bond is $50,000, the most the surety bond company will have to pay for any single claim is $20,000, and $50,000 total. This is regardless of the length of time a bond company has written the License Bond for the contractor. However, payment of the contractor license Bond may not relieve the contractor of additional amounts that may be owed to a damaged party.
Virginia Contractor License Bonds are required for licensing purposes only. They are not meant to replace other bonds or obligations. Virginia contractors may also need other License and Permit Bonds that may be required by certain municipalities. Many of these bonds can also be purchased online at Virginia Surety Bonds page.
Commercial contractors may also need contract surety bonds such as bid bonds, performance bonds, and payment bonds. These bonds have different obligations, costs and underwriting requirements.
Class A and Class B Virginia contractors need to provide Virginia Contractor License Bonds or meet certain financial requirements. These License Bonds are easy to obtain online and are inexpensive. Contractors will need to decide if it makes more sense to provide a License Bond or meet the financial requirements. Virginia contractors can learn more about surety bonds, including frequently asked questions by visiting our Complete Guide. Contact the construction bond experts at Axcess Surety today for all your bond needs and solutions.
Axcess Surety is the premier provider of surety bonds nationally. We work individuals and businesses across the country to provide the best surety bond programs at the best price.
