California Contractors Bond - Contractor Talk - Professional Construction and Remodeling Forum

cohibakid · 06-08-2009, 02:52 PM

Does anyone know of an Insurance group that will provide reasonable rates on the mandatory $12,500 bond requirement. My credit has some old credit card debt from over 10 years ago from a divorce. My rate has gone from $116 per year to $575 per year. I have never had a claim this is just an increase based solely on my credit.

Chris Johnson · 06-08-2009, 04:11 PM

I'd get your credit cleaned up if I were you.

My bond was $ 269.00 for three years

License Guru · 06-09-2009, 12:29 AM

Quote:

Originally Posted by cohibakid

Does anyone know of an Insurance group that will provide reasonable rates on the mandatory $12,500 bond requirement. My credit has some old credit card debt from over 10 years ago from a divorce. My rate has gone from $116 per year to $575 per year. I have never had a claim this is just an increase based solely on my credit.

Unfortunately that's how the bond world spins now. Since Surety Co. of the Pacific sold out to HCC, all bonds are now credit based.

They were the last company that didn't use credit scores.

CLWord77 · 08-25-2009, 11:08 AM

if it went to $575 and credit is an issue, be thankful. ACIC's rates go up to $1,334 per year, and going to a nonstandard/high-risk carrier can run several hundred dollars higher, not to mention that some will require co-signer or collateral considerations as well. There are some contractors coming out of recent bankruptcy that are paying $2,500 or more in annual rates because their credit is in shambles.

License Guru · 08-25-2009, 11:18 AM

OUCH!!!

Thanks for you input CLWord77 and welcome to CT.

bwfencing · 10-22-2009, 11:06 AM

I'm a Fence contractor. I paid $134 a yr. Now it's$1,334.00 How am I to survive. I don't have that kind of money!!!

License Guru · 10-22-2009, 11:15 AM

Quote:

Originally Posted by bwfencing

I'm a Fence contractor. I paid $134 a yr. Now it's$1,334.00 How am I to survive. I don't have that kind of money!!!

Was there a claim on your bond or did you file BK?

MacRoadie · 10-22-2009, 11:32 AM

Quote:

Originally Posted by License Guru

Was there a claim on your bond or did you file BK?

Ever since the bond companies went from flat rate tables to basing bonds on credit scores, bond fees have gone through the roof. I don't know anyone who is paying less than $500 for a bond these days.

Other states are no different. The average seems to be working out to between 5% and 10% or $100 for every $1,000. I have an associate licensed in Utah where the bond requirement is $50,000. You can guess what he's paying.

JumboJack · 10-22-2009, 11:38 AM

I just payed 116.00 for my 12,500.00 bond.

bwfencing · 10-22-2009, 01:03 PM

Quote:

Originally Posted by License Guru

Was there a claim on your bond or did you file BK?

No, No claims or bankruptcy....yet. I might have to with this "****" going on.

License Guru · 10-22-2009, 01:09 PM

Did you shop around?

bwfencing · 10-22-2009, 01:51 PM

Yes, and everybody has the exact same amount.

CLWord77 · 10-23-2009, 05:44 PM

There are very few programs/providers out there that are going to beat ACIC's preferred rates by more than a few dollars- the only exception would be if there were an item on ACIC's credit evaluation that didn't show up on another company's report.

Basically, this is how it breaks down:

CA License Bonds- Excellent Credit about $100-$120, perhaps less if multi-year is purchased. Fair to Good Credit $575.00-$800.00. Poor credit $1,350... and awful credit? If ACIC doesn't offer you terms, you're stuck in high-risk. The best I've been able to do for someone declined at ACIC is about $2,000/yr, and I've seen rates as high as $3,125/yr.

Framer53 · 10-23-2009, 07:06 PM

Quote:

Originally Posted by cohibakid

Does anyone know of an Insurance group that will provide reasonable rates on the mandatory $12,500 bond requirement. My credit has some old credit card debt from over 10 years ago from a divorce. My rate has gone from $116 per year to $575 per year. I have never had a claim this is just an increase based solely on my credit.

Slightly off topic, but if the bad credit is that old, how did they find out? You credit report doesn't list anything that old, ecept tax liens.

Nigel S. Shorts · 11-07-2009, 01:51 AM

What a kick in the nads it was, when I opened up my bond renewal 2 DAYS before I sent in my license, only to be confronted with this crap. I hadn't heard anything about price hikes and just assumed i was going to be cutting a $150 check again for 2 years.

They claimed I needed a co-signer to avoid the $1334 per year fee. That would have reduced it to $375. I ran my credit. It was pretty good- a 761. And that's with an old Federal tax lien that's winding down. I finally found these folks: http://www.southcoastsurety.com/index.htm

They approved me for $200 for two years without a co-signer. This increase is rotten to the core if you ask me. Most pay less for car insurance.

License Guru · 11-07-2009, 02:09 AM

Moral of the story......

Don't accept the bloated renewal price from your agent/surety... shop around!