What a contractor license bond is
Some states, and many cities and counties, make contractors post a bond to get or renew a license. It protects customers, workers and the public if the contractor breaks the licensing laws, for example by abandoning a job or not paying workers. The contractor repays the surety for any claim it pays.
In Utah
Utah contractors must show financial responsibility to the Division of Professional Licensing. A license bond is required only in some cases, such as a recent bankruptcy or unpaid debts.
- The bond must stay in place during licensure until the Division gives written permission to drop it.
- The Division may set a higher amount based on financial, criminal or disciplinary history.
You need this bond if you're
- A contractor applying for a new license
- A contractor renewing or reactivating a license
- A business changing its entity type or qualifier
- A contractor starting work in a city or county that requires its own bond
What the surety looks at
Basic business and owner details. Most license bonds need a credit check but no financial statements.