Minnesota Contractor Bond

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Minnesota Contractor Bonding Requirements

Not all Minnesota contractors are required to get bonded, but certain cities and counties have requirements for some holders of certain contractor licenses. There are statewide requirements for some specialty contractors as well.

If you have been required to post a contractor license bond, it’s important to be aware of the responsibilities it carries. It’s a type of surety bond agreement between three parties: a principal (the contractor), an obligee (the agency requiring the bond), and the surety (a bonding company underwriting the bond).

Contractor license bond ensure contractors comply with the provisions of their license types. They also act as protection to their clients, employees and the state. If a contractor violates the terms of their bond agreement, they can face a claim, serving to compensate third parties that may have suffered as a result of the violation.

Apply for a free no-obligations quote on your contractor license bond!

Keep reading for more useful information about contractor license bonds in Minnesota.

Questions about Contractor License Bonds in Minnesota

Where in Minnesota is a bond required from contractors?

The following places require a contractor license bond from some holders of contractor licenses:

  • Brainerd
  • St. Paul
  • Minneapolis

Furthermore, the following types of contractors are required to post a bond as well:

  • Water conditioning contractors
  • Subsurface sewage treatment contractors
  • Plumbers
  • Electricians
  • Residential roofers
  • Elevator contractors
  • Technology system contractors
  • Masonry contractors

Make sure to contact your local regulation authorities to find out which exact requirements apply to you and your business.

How much do contractor license bonds cost in Minnesota?

Surety bonds are paid in premiums, usually annual ones. To calculate yours, you first need to know the required total amount of your bond. The total amount, also known as the penal sum of the bond, refers to the coverage the bond can offer to a claimant.

Your premium will vary between 1%-3% of this amount if you have a high credit score, but can go up to 10% if you have bad credit. Check out the table below for total amounts by location and license type.

Minnesota Contractor License Bond Cost
Bond Type Surety Bond Amount Above 700 Between 650-699 Between 600-649 Below 599
Water Conditioning Contractor Bond $3,000 $100 $100 $100-$150 $150-$300
St. Paul Sidewalk Contractor's Bond $5,000 $100 $100 - $125 $125-$250 $250-$500
Masonry Contractor Class A License Bond

Minneapolis Specialty Contractor Bond

Individual Sewage Treatment Contractor Bond

$10,000 $100-$150 $100-$300 $300-$500 $500-$1,000
Residential Roofer Contractor Bond $15,000 $188-$375 $250-$750 $625-$1,250 $1,250-$2,500
Technology System Contractor Bond

Plumbing Contractor Bond

Electrical Contractor Bond

Elevator Contractor Bond

Mechanical Contractor Bond

$25,000 $188-$375 $250-$750 $625-$1,250 $1,250-$2,500

* This table provides a ballpark estimate of potential bond costs. Bond pricing can fluctuate over time due to a number of factors. For exact pricing, please complete an application.

Bond amounts for some contractor bonds cannot be displayed here, because their amounts are determined on a case-by-case basis. If your bond is one of them, contact your local authority to inquire about the total amount before you apply to get bonded.*

The estimates above are based on credit score alone as this is considered the most important factor during the underwriting process. However, other information about your business can also affect your premium. Find out all about it on our “What Does a Surety Bond Cost?” page.

What happens if I have bad credit?

Even though it’s important in the underwriting process, bad credit alone won’t prevent you from getting bonded. In fact, 99% of applicants with a low credit score or past-due items in their report can still get bonded, albeit at a higher price.

Two exceptions are applicants with open bankruptcies, and those who are late on their child support payments. You can learn more about getting bonded with bad credit on our specially dedicated page.

How do I apply for my contractor bond?

Applying for the bond you need is a straightforward process. You can submit our online application, which takes only a few minutes to complete. If you provide ownership information, this will help us give you a more precise bond quote.

After you submit the application, we’ll contact you with a free no-obligations quote. Next, we’ll go over the paperwork with you and let you know what we need to finalize your application. After we process your payment, turnaround time is usually one or two business days.

Ready to apply for your contractor bond? Start with a free quote!

We will send you the signed bond form via email. You’ll need to include this form with your license application, but you can request copies via fax or email.

How do I get a Minnesota contractor license?

Here are some of the steps you need to undertake to get a Minnesota contractor license:

  • Get a Tax Identification Number
  • Register with the Secretary of State
  • Get a Federal Employer Identification Number (EIN)
  • Buy workers’ compensation and unemployment insurance (if required)
  • Pay applicable fees

What happens in case of a claim?

What constitutes a source of a claim can differ based on your license type. This is why it’s essential that you understand local building codes and all regulations that apply to you. Violating the bond agreement can make you liable for amounts up to the penal sum of your bond. Furthermore, applicants with a history of past claims may see their next bond application refused.

If you think a claim against you doesn’t have a solid legal ground, you can try to fight it in court, sometimes with the help of the surety. Sureties can provide legal assistance if they feel you haven’t broken the rules.

Still got questions about Minnesota contractor bonding requirements? Just call us at (877)-514-5146 and our surety agents will help.

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Lance Surety Bonds
Lance Surety Bond Associates, Inc. is a Pennsylvania-based surety bond agency that offers bonding at competitive rates in all 50 states. Established in 2010, our company has grown to become one of the top online bond producers in the country. Working exclusively with A-rated and T-listed bonding companies gives us the confidence to offer a 100% money-back guarantee. read more

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