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How much does a contractor license bond cost in Alabama?
The cost of a contractor license bond in Alabama varies depending on the contractor’s trade and place of work. Some of the bonds are subject to underwriting meaning a review of your financial history will be required. However, many Alabama contractor bonds can be issued instantly online for just $100 without a credit check.
If you are applying as a heating and air conditioning or refrigeration contractor, Alabama requires you to have a $15,000 surety bond to get a license. For more information, visit our page for Alabama HVAC contractor bonds. For residential roofers in Alabama, you can learn more about the $10,00 bond requirement and how to become licensed with our Alabama Residential Roofer License Guide.
Why are Alabama contractors bonded?
Professional contractors work in the high-risk construction industry, which can pose many different types of liability issues, such as legal, quality, and financial risks. Contractor license bonds are used to guarantee that contractors will obey the laws of the industry and follow state regulations. Should a contractor fail to do this, the affected party can make a claim against the contractor’s surety bond to receive compensation for any resulting losses. For several cities in Alabama, we offer contractor license bonds for contractors of all types. We can get you the bond you need quickly, easily, and accurately.
More specifically, contractor bonds in Alabama are put in place to ensure that principals (contractors) complete construction work in accordance with the laws of the city/state. This includes adhering to all building codes, paying all taxes that become due, and more. These bonds protect the city/state and/or any individual who is harmed as a result of the principal’s noncompliance from financial loss up to the full amount of the bond. The principal must reimburse the surety for all damages paid out.
All Alabama contractor bonds have unique terms, so applicants should be sure they understand the fine print of their surety bond contracts during the bonding and licensing processes.