South Carolina Contractor License Bonds

At Surety Bonds Agent, we offer a full range of surety bonds nationwide through an extended carrier network. Continue below to learn more about South Carolina contractor license bonds. If you have additional questions or want to explore bonding solutions for your business, speak with one of our knowledgeable surety bond experts.

 

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What Is a Contractor License Bond?

A South Carolina contractor license bond provides a certain level of financial protection for the licensing authority in the event of a financial loss resulting from a licensed contractor’s regulatory violation or other unlawful or unethical act. If such a loss occurs, the injured party can seek compensation by filing a claim for monetary damages.

 

Who Needs One?

The South Carolina Residential Builders Commission requires the following contractor license bonds:

  • For registered specialty contractors—$5,000
  • For licensed residential specialty contractors—$10,000
  • For residential builders seeking certification of authorization—$15,000

Additionally, the South Carolina Contractor’s Licensing Board can require contractor license bonds from contractors who don’t meet the Board’s minimum net worth requirements for licensing. In such cases, the required bond amount is twice the amount of the applicable net worth requirement.

Some local jurisdictions have their own licensing and bonding requirements as well.

How Does a Contractor License Bond Work?

There are three parties to every South Carolina contractor license bond: the obligee, the principal, and the surety. The licensing authority is the obligee, the contractor is the principal, and the bond’s guarantor is the surety.

The surety’s guarantee takes the form of an agreement to extend credit to the principal if the principal is unable to come up with sufficient cash to pay a claim right away. Upon receipt of a claim the surety deems valid, the surety will pay it on the principal’s behalf and give the principal a repayment schedule. A principal who fails to repay the surety as agreed is likely to be sued by the surety to recover the debt.

How Much Does It Cost?

Multiplying the required bond amount by the premium rate assigned by the surety through underwriting yields the annual premium cost for a South Carolina contractor license bond. The underwriting process is aimed at determining the risk of the surety not being repaid for claims paid on behalf of the principal. The premium rate, based largely on the principal’s personal credit score, will reflect that risk level.

The premium rate for a well-qualified principal usually is in the range of 1% to 3%. 

At Surety Bonds Agent, we offer a full range of surety bonds nationwide through an extended carrier network. Continue below to learn more about South Carolina contractor license bonds. If you have additional questions or want to explore bonding solutions for your business, speak with one of our knowledgeable surety bond experts.

 

CONTACT US FOR A

FREE CONSTRUCTION BOND QUOTE

What Is a Contractor License Bond?

A South Carolina contractor license bond provides a certain level of financial protection for the licensing authority in the event of a financial loss resulting from a licensed contractor’s regulatory violation or other unlawful or unethical act. If such a loss occurs, the injured party can seek compensation by filing a claim for monetary damages.

 

The South Carolina Residential Builders Commission requires the following contractor license bonds:

  • For registered specialty contractors—$5,000
  • For licensed residential specialty contractors—$10,000
  • For residential builders seeking certification of authorization—$15,000

Additionally, the South Carolina Contractor’s Licensing Board can require contractor license bonds from contractors who don’t meet the Board’s minimum net worth requirements for licensing. In such cases, the required bond amount is twice the amount of the applicable net worth requirement.

Some local jurisdictions have their own licensing and bonding requirements as well.

There are three parties to every South Carolina contractor license bond: the obligee, the principal, and the surety. The licensing authority is the obligee, the contractor is the principal, and the bond’s guarantor is the surety.

The surety’s guarantee takes the form of an agreement to extend credit to the principal if the principal is unable to come up with sufficient cash to pay a claim right away. Upon receipt of a claim the surety deems valid, the surety will pay it on the principal’s behalf and give the principal a repayment schedule. A principal who fails to repay the surety as agreed is likely to be sued by the surety to recover the debt.

Multiplying the required bond amount by the premium rate assigned by the surety through underwriting yields the annual premium cost for a South Carolina contractor license bond. The underwriting process is aimed at determining the risk of the surety not being repaid for claims paid on behalf of the principal. The premium rate, based largely on the principal’s personal credit score, will reflect that risk level.

The premium rate for a well-qualified principal usually is in the range of 1% to 3%. 

 

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Request a quote online or call today to speak with one of our surety bond experts about obtaining a South Carolina contractor license bond.