As a contractor, you probably know you need a surety bond. Surety bonds are designed to protect you and your clients if one of you has questions about a project or if something does not go as planned. Despite the necessity of surety bonds though, many contractors do not know how to get them. They often think the process is long and arduous.

In reality, the steps in securing a surety bond are much quicker and easier than you probably think. If you take the process step by step and do not let yourself get overwhelmed, you can rest secure in your surety bond and begin working on projects with added protection.

Step 1: Verify Forms and Amounts

Many bonds go by the name surety bond, so you must specify which bonds and amounts you need. If your company has a CPA, ask him or her to guide you in choosing these things. If not, do your homework. Ask your supervisor what surety bonds contractors use. Consider examining which surety bonds competitors use and the benefits of each bond and amount. You might investigate reputable surety bond websites to get basic questions answered or find out the average amount for the types of projects you do most.

Once you know the bond and amounts you need, verify your state or city’s surety bond forms. Each state has different surety bond laws and each city uses different forms. Whether you have moved frequently or worked in the same area for decades, it is always worth double-checking your form and asking if anything has changed. Surety bonds often get tied up in red tape because of simple form mistakes.

Step 2: Get a Quote

Along with the amount of bond you will need, you also need to know how much you will pay for it. Some project owners pay for their contractors’ surety bonds, but many contractors pay out of their own pockets. If this is the case for you, be prepared. Check your credit rating and score, as well as your banking history. The better credit you have, the lower percentage you will pay on the surety bond amount. If you have not checked your ratings in a while or need help deciphering them, ask your company’s CPA or other financial adviser.

Step 3: Apply for a Bond

How you apply for a bond will depend on your company’s rules. Some contractors search online for bonding companies that issue surety bonds nationwide. This is often recommended for contractors licensed to work in several states, or contractors who intend to move frequently for access to the projects they want.

Nationwide bonding is not always the best choice, though. If you intend to work in the same area for several years, or you work for an established company that gets plenty of projects, apply for surety bonds that affect your area. In addition, ask your supervisor what bond types and amounts are approved for your company. If specific bonds and amounts are recommended, apply for those first.

Step 4: Verify Information

Never begin a project without ensuring the business information on your surety bond is correct. Surety bonds are rejected for several reasons, including misspelled business names, incorrect addresses, incorrect bond amounts or missing signatures.


While the surety bond process may look long, it is actually easy if you know which steps to take. Research your bond types and amounts thoroughly, and do not be afraid to ask for help from a supervisor, CPA or other financial adviser.