Ohio Contractor License Bonds

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Who Is Required To Purchase an Ohio Contractor Bond

Ohio does not have any statewide contractor specific bonding requirements.

The current contractor bonding requirements are requested at the county and/or city level. Here's a list of the cities where we've helped get contractors bonded:

• Pickaway county
• Summit county
• Cleveland
• Columbus
• Cincinnatti
• Dayton
• Maple Heights
• Springfield
• Cleveland Height
• Pepper Pike

This is not an exhaustive list. There are a lot more cities with bonding requirements.

It's not just the location of the project. Most of the license classifications are required to purchase a bond as well, including:

• Residential contractors
• General contractors
• Plumbing contractors
• Electrical contractors
• HVAC contractors

This too, is not an exhaustive list of all the classifications that may require a bond.

Some of these bonds will be contractor license bonds and others will be permit bonds.

A license bond is required before a contractor will be issued the necessary license to perform work in the country or city.

A permit bond is required for a specific job and is only active for the length of that job.

You may hear "right of way" bonds. A right of way bond is a permit bond, but required for construction on public property like a city street, sidewalk, or sewer system.

Ohio has so many cities that require a bond, if I list them all it can be a little overwhelming.

You'll be notified of any bonding requirements when you apply for the necessary permits to begin work on the project.

Even though it may seem overwhelming with so many potential bonding requirements, all contractor surety bonds have the same (or very similar) purpose.

 

Why is an Ohio Contractor Bond Required?

Local Ohio government agencies require contractors to obtain licenses and demonstrate the:

• Appropriate experience levels
• Required education requirements
• Proper business records are in registered
• Correct license type being secured

Being licensed ensures contractors have met this set of standards and the public can hire them with confidence, knowing their projects will be completed according to the contract and building codes.

The bonding required is a primary way county's and cities hold contractors accountable to these promises contractors make to their customers.

 

What Does an Ohio Contractor License Bond Protect Against?

Again, all contractor bonds serve the same or similar purpose of ensuring the contractor completes projects and does not financially harm their customers on purpose.

Despite the licensing process, there will always be a handful of contractors who cut corners to increase profits or even steal money from their customers.

These fraudulent actions of misconduct include:

• Breaking the terms of a construction project
• Taking deposits or down payments and never starting or completing a project
• Replacing agreed upon materials with cheaper alternatives to increase profits
• Failing to pay subcontractors for completed work
• Neglecting building codes and purposefully performing poor quality work

If a contractor is found guilty of any of these actions, a claim can be made against the contractor license bond or permit for financial repayment, but only up to the specific bond amount.

 

How Much Does an Ohio Contractor Bond Cost?

At a high level the cost of a contractor bond is based on a rate quoted from a surety and the bond amount.

 

Step 1: Determine The Correct Bond Amount

Here are some of the bond amounts for the cities we've mentioned. Keep in mind you will be told the correct bond amount and license process when you go to pull permits for a job or when you decide to offer services in a particular city.

 

Cleveland Contractors

 

Cleveland Surrounding Cities

 

Columbus Contractors

Nearly every other major Columbus contractor bond has an amount of $25,000.

 

Columbus Surrounding Cities

All other Dayton contractor licenses have a $10,000 bond amount.

 

Cincinnati Contractors

Cincinnati does not have too many bonding requirements other than right-of-way bonds. Remember, right-of-way bonds are permit bonds required for projects that involve construction on public property like streets, sidewalks, sewer systems, and the like.

Nearly all Cincinnati contractor bonds have an amount of $10,000.

 

Step 2: Determining The Bond Price

The price of a contractor surety bond is based on an assessment from a surety. A surety is an insurance company that underwrites surety bonds.

The factors that influence price are:

• Personal credit of the owner or owners
• Contracting experience and industry experience
• Any prior bond claims if you or an owner has been licensed in the past

However, if you use Surety Bonds Direct, you can skip having to worry about your personal credit and experience when purchasing your surety bond.

We have secured low fixed prices for all Ohio contractor bonds. The prices are as follows. Just click on the link to purchase.

 

Step 3: Purchase Your Bond

Purchasing your bond is easy. It requires completing an online order form or you can complete your purchase over the phone.

What Happens After You Purchase Your Bond?

After you purchase your bond, Surety Bonds Direct's issuing department will prepare your bond with the correct signatures, notarized seals, and the required power of attorney.

Once your order is complete our issuance team will prepare your bond with:

• The correct form
• The required signatures
• Any required power of attorney

Currently, all Ohio contractor bonds can be emailed to you making the process faster.

If the agency requiring the bond wants the original bond, we can mail you the original bond. Make sure you account for shipping time.

 

Determining The Contractor Bond Term

Bond terms and expirations are different for each type of bond.

Most county and city contractor bonds tend to expire on December 31st of each year. If this is not the case for your bond, it will expire one to three years from the effective date.

The effective date is the date your bond becomes active. You choose this date when you purchase your bond.

Permit bonds (and right of way bonds) are purchased for the life of the project. Most permit bonds have a term or 12 months. If the project extends past this time period, you would have to renew the bond.

 

Renewing Your Contractor Bond

Your Surety Bonds Direct bond specialist will reach out to you 30 to 45 days in advance of your renewal date to make paying the renewal premium easy.

Once you pay the renewal premium your bond is activated for the next term.

If you no longer need your bond, don't renew it and it will expire automatically.

 

Contractor Bonds And Getting Your Ohio Business License/Registration

Applying for a state or local license typically follows the following steps:

1. Pass any required examinations
2. Outline business management
3. Decide on license classification and specialty or registered agent
4. Purchase the required surety bond
5. Pay all the appropriate fees
6. Submit your completed application

We do have a detailed write up about the Cleveland Height contractor license.

Here are some local resources to help you find the information you need to get licensed:

• Summit County
• Cleveland
• Columbus
• Cincinnati
• Chagrin Falls
• Pepper Pike
• Cleveland Heights
• Massillon
• Springfield
• Maple Heights
• Dayton