Arizona Contractor License Bonds

Arizona Contractor License Bond

The State of Arizona requires contractors to be licensed through the Arizona Registrar of Contractors (AZ ROC). As a prerequisite of the license, applicants must acquire a Contractor License Bond. The contractor’s license classification, bond form type, and required bond limit will depend on the extent and specific field in which construction work is being performed.

Jet Insurance Company provides Arizona Contractor License Bonds to act as a financial guarantee for the sake of Arizona residents, businesses, and the AZ ROC in cases of the contractor committing incomplete or faulty work, breach of contract, or non-payment of licensing fees and/or other commitments.

APPLY FOR A CONTRACTOR LICENSE BOND

Jet is a direct surety provider and exclusively offers affordable monthly rates to Arizona contractors. If you are looking to procure or maintain a contractor license, the Jet team can help you secure the required Contractor License Bond quickly!

What Is the Price of an Arizona Contractor License Bond?

At Jet, contractors can pay as low as $5 monthly or $50 annually for their bond. Contractors can also purchase a 2- or 3-year bond term with Jet and save some extra cash. Prices are based on the bond limit, work performed, and a personal credit check of the contractor.

Our rates are the best! And Jet can do that as we have eliminated unnecessary middlemen brokers and agents along with their fees and commissions.

Bond LimitMonthlyAnnual
$4,250$5$50
$7,500$8$75
$9,000$9$90
$15,000$11$113
Arizona Residential Contractor Bond Rates

Jet’s preferred prices are reflected above for residential contractors who only perform construction services on residential structures such as houses, townhouses, condominiums, or any building within a residential property line. 

Bond LimitMonthlyAnnual
$5,000$5$50
$15,000$9$90
$25,000$15$150
$50,000$30$300
$100,000$60$600
Arizona Commercial Contractor Bond Cost

Our preferred prices are reflected above for commercial contractors who only perform construction services on schools, corporate offices, restaurants, retail establishments, etc. Essentially anything other than residential construction.

For individuals who perform both residential and commercial construction, dual licenses are required by the AZ ROC. The contractor bond limits for dual licensed contractors are calculated by adding the amount of each residential and commercial bond. Jet’s Dual Contractor License Bond prices are a combination of the residential and commercial rates, but when calculated out are basically our commercial contractor rates shown above. 

Choosing Jet gives you the advantage of paying for your bond on a monthly basis or annually online in moments. However, for larger bond limits over $50,000, Jet may need to review additional information such as the contractor’s business experience and financial statements before a bond can be approved and lower prices offered. 

What Is the Purpose of the Arizona Contractor License Bond?

A Contractor License Bond’s main purpose is to act as a form of financial protection for subcontractors, residential or commercial clients, suppliers, and the Arizona Registrar of Contractors should the contractor cause damages to such parties. The bond ensures that an individual can seek restitution through the license bond, provided by Jet, if the contractor refuses or is unable to reimburse the claimant for damages that the contractor is at fault for. 

The AZ ROC was established in 1931 as a regulatory agency with the purpose of enforcing state contractor law in order to protect local residents and businesses from you the contractor. AZ ROC’s objective is to build a safe and responsible market-economy of reputable contractors for the Arizona construction industry.

The licensing requirements are a mechanism to protect the welfare of the public and promote quality construction work. While the Arizona Contractor License Bond is an additional tool used by the AZ ROC to receive a third party guarantee, in this case from Jet, that you, the contractor, are financially responsible enough to engage in business within Arizona. Without that promise from Jet, you wouldn’t be allowed to be licensed by the state, but we trust you and have your back.

How Does the Application Process Work With Jet?

Our bond application process is quick and easy! The Arizona Contractor License Bond can be purchased online or over the phone in just minutes. Jet will require you to confirm some general company information and to provide the contractor’s social security number. The Jet team does base bond rates (as all surety companies do) on a personal credit check, which takes seconds and will not affect your credit score.

For commercial and dual contractors with larger bonding limits (over $50,000), a quick manual review of your application may be required by one of our underwriters. 

Once payment is made for our monthly, annual, or multi-year option, a copy of the bond and receipt will immediately be sent to you for your personal records. 

APPLY FOR A CONTRACTOR LICENSE BOND

How Are Contractor License Bonds Filed in Arizona?

Jet will take care of the signing, sealing, and notarization of the Contractor License Bond form for you and at no extra cost! 

According to state legislation, the original bond must be submitted to the Arizona Registrar of Contractors along with your signature. The bond must then stay on file with the AZ ROC for the remainder of the contractor offering such services in line with that license classification. Failure to do so will result in the revocation of the contractor’s license. 

The original Contractor License Bond form should be mailed to the following address:

Arizona Registrar of Contractors
P.O. Box 6688
Phoenix, AZ 85005-6748

For details regarding contractor license requirements and additional forms needed, further information can be found on the AZ ROC’s “Applying for a License?” page. New license applications are submitted to the following mailing address: PO Box 6748 Phoenix, AZ 85005-6748 or handed off in person at 1700 W. Washington St. Suite 105 Phoenix, AZ 85007-2812.

Can Contractor License Bonds Be Cancelled? Are Refunds Available?

With Jet, you can cancel the bond at any time! Contractor License Bonds are continuous until cancelled by the surety company so cancellation will need to be requested by Jet to the Arizona Registrar of Contractors. Once the Jet team sends a written cancellation notice to the AZ ROC, liability of the bond will be released within 30 days of the notification receipt. 

If you are on our monthly payment option, Jet must charge for that 30-day grace period as the bond remains active during that time. If an annual or multi-year payment option was chosen, the Jet team will determine if there is any unused premium available to refund to you.

Can Contractor License Bonds Be Renewed in Arizona?

With Jet’s monthly payment option, the obligation to renew your contractor’s bond is completely erased! Payments for the license bond will continue to come out of your preferred account automatically until cancellation is requested. 

For contractors who pay in full, Jet will send you a renewal invoice prior to the bond term’s expiration date. No additional paperwork or extra renewal fees are required, payment is all that is needed. The Jet team will take care of the rest!

How Can Contractors Avoid a Claim on Their Bond?

Licensed contractors are expected to follow all Arizona Registrar of Contractors regulations and state laws pursuant to Arizona Revised Statutes Title 32, Chapter 10. The statutes are extensive and should be reviewed thoroughly by all individuals looking to pursue and maintain a contractor license. Failure to follow contractor law in Arizona may lead to severe penalties.

Should a complaint be filed against a contractor, the Registrar of Contractors will schedule a mandatory hearing with the contractor to discuss details of the violation and what, if any, further action needs to be taken. This can be corrective action for the benefit of the damaged party, monetary fines, suspension of the contractors license, the indefinite revocation of the contractors license, a citation, civil penalties, large fees, and/or a bond claim. Below are common examples of prohibited acts that could facilitate disciplinary action, if uncorrected, that may include a bond claim:

Further prohibited acts and timelines in which action may be taken can be found listed in Arizona Revised Statutes 32-1154. Claims cannot be filed on the contractor’s license bond beyond two years following the date of commission for the construction project, the delivery of materials, or the services provided in which the violation complaint is based upon. 

If a claim on a Contractor License Bond is pursued, it will have to go through the AZ ROC’s complaint and investigation process before action can be taken. The info-graphic below provides details on the different paths that can commence during the contractors violation complaint and investigation process. 

Arizona Registrar of Contractors Complaint and Investigation Process

In the event that the contractor and claimant cannot resolve the complaint in the above shown mediation process, the case will be referred to the AZ ROC’s legal department. Once reviewed, the AZ ROC will send the contractor an official citation with a final opportunity to respond and resolve the dispute before a formal legal hearing is scheduled; the contractor has 10 days to respond, failure to do so will lead to further disciplinary action upon the contractor's license. 

The AZ ROC may schedule a hearing with the Office of Administrative Hearings that must be attended by all parties involved. Following the hearing, the Administrative Law Judge has 20 days to notify the AZ ROC with their recommended decision. The AZ ROC then has 30 days to consider and/or modify the judges decision and will issue a final order to the contractor. This final order can result in a variety or disciplinary actions including a claim on the contractors license bond. 

The AZ ROC will also allow claimants to take separate civil action against the contractor (this action can be taken simultaneously during the AZ ROC’s legal proceedings). If civil action is validated by an Arizona state judge, the bond can also be used to cover the claimants financial damages as well as a reasonable attorney's fee fixed by the court.

What Happens if I Get a Bond Claim?

Immediately contact Jet upon receipt of a claim notice! The Jet team will brief you on how our investigation and claim process works and then will proceed with a thorough review and analysis of the claim details, any supporting documentation, and the AZ ROC’s complaint/legal proceedings (see above). If the claim notification was sent from a state court, the same review and investigation process will commence by the Jet team. 

For claims that are found to be valid, Jet will make payment up to the bond limit. Surety license bonds are like letters of credit that can demonstrate to the AZ ROC it is economically safe to license a contractor. The bond protects the AZ ROC and public from the contractor. Unlike insurance, the contractor is ultimately responsible for their actions and must reimburse Jet for paid out claims. Failure to do so will lead to cancellation of the Arizona Contractor License Bond and difficulty obtaining a bond in the future.

A contractor's license is automatically suspended if a claim payment is made from their bond, the license will not qualify for reactivation with the AZ ROC until the full bond amount is replaced.

How Do I Determine My License Bond Limit?

According to Arizona Revised Statutes 32-1152, license bond limits for contractors are based on the license classification and the estimated gross volume of construction projects being performed. Refer to the charts below to determine which bond limit will be required of you by the AZ ROC. 

Residential general contractors in Arizona build, repair and remodel residential structures. The general classification includes residential engineering, swimming pool construction, and pre-manufactured hot tubs. Electrical, plumbing, HVAC, and boiler work (who does that in AZ?) is not allowed to be conducted under the general classification, and whoever performs that work must have the related specialty classification.

Gross VolumeBond Limit
$750,000$9,000
$750,000$15,000
Residential General Bond Limits

Residential specialty contractors build, repair, and remodel residential structures that require specialized construction skills in fields such as excavation, electrical, carpentry, elevator work, asphalt paving, and blasting, etc.

Gross VolumeBond Limit
$375,000 and less$4,250
$375,001 and higher$7,500
Residential Specialty Bond Limits

Commercial general contractors build, repair, and remodel commercial properties and structures. The commercial general classification includes general engineering, drilling, seal coating, waterworks, and general small construction work, etc.

Gross VolumeBond Limit
$150,000 and less$5,000
$150,001 to 500,000$15,000
$500,000 to 1,000,000$25,000
$1,000,001 to $5,000,001$50,000
$5,000,001 to $10,000,000$75,000
$10,000,001 and higher$100,000
Commercial General Bond Limits

Commercial specialty contractors build, repair, and remodel commercial properties and structures that require specialized skills in fields such as acoustical systems, floor coverings, concrete, hardscaping, plastering, and water conditioning, etc. 

Gross VolumeBond Limit
$150,000 and less$2,500
$150,001 to 500,000$7,000
$500,001 to 1,000,000$17,500
$1,000,001 to 5,000,001$25,000
$5,000,001 to $10,000,000$37,500
$10,000,001 and higher$50,000
Commercial Specialty Bond Limits

Contractors seeking a dual license will only need to acquire a single surety bond. Dual license bond amounts are calculated by adding the total amounts of work generated from either the contractor’s general residential and commercial projects or specialty residential and commercial projects. 

Are Contractors Required to Obtain Any Additional Bonds?

Maybe. According to Arizona Revised Statutes 32-1132, residential general contractors and dual licensed contractors are required by the AZ ROC to either acquire a secondary surety bond in the amount of $200,000 or pay an assessment fee to the Residential Recovery Fund.

The Residential Recovery Fund is established by the AZ ROC and acts as an additional form of financial protection for residential homeowners. The fund is solely used for further reimbursement of damages suffered by claimants who have already received restitution via the contractors license bond. More information about the Recovery Fund can be found on the AZ ROC’s “Recovery Fund” page. 

Contractors may also be required to obtain additional surety bonds based upon the types of construction projects they are performing. Such secondary bonds and details regarding them can be found below. 

Bid Bond
Performance Bond
City of Prescott Contractor Performance Bond
Arizona Contractor Taxpayer Bond
Right of Way Bond - Phoenix
Right of Way Bond - Maricopa County

What Other Forms of Insurance Are Required of Arizona Contractors? 

Pursuant to Arizona Revised Statutes 32-1122, if applicable, the contractor is required by law to secure workers compensation insurance. Workers compensation provides benefits to employees such as disability coverage, medical treatments, and the reimbursement of wages lost in cases of the employee obtaining an injury or illness on the job. Applicable contractors must provide their workers compensation insurance policy number or provide proof of self-insurance when submitting their contractor license application. Contractor licenses will not be granted until this requirement has been fulfilled.

While not required for licensure, contractors may need to obtain general liability to get onto certain jobs. Whether or not a job requires it, contractors should purchase general liability to protect from lawsuits arising from damages contractors may cause to people and their property. One of those lawsuits can lead to financial ruin.

Who Needs a Contractor License Bond in Arizona?

The State of Arizona requires all contractors to furnish a Contractor License Bond in order to activate and maintain a license with the Arizona Registrar of Contractors. The license classification and necessary bond form will be based on the type of work that is conducted by the contractor such as residential or commercial construction projects. Contractors who offer both residential and commercial services obtain a dual license and bond. 

It is important to note that contractors with different classifications need licenses for each classification and will need to file a bond for each one too. Meaning, if a contractor has multiple license classifications, an individual bond will be needed for each different classification of construction work. For example, a contractor that is licensed as a general residential contractor (B) and as an electrician (R-11) will have two license numbers and a bond for each. Good thing Jet has the lowest rates and quickest process to get contractor bonds.

According to Arizona Revised Statutes 32-1121 & 32-1121; Version 2, exclusions from the contractor license and bond requirement include utility workers, architects, specialty engineers, gardeners, and owners of property who work to improve such property. Handymen who conduct work under $1,000 per a job are also not required to be licensed by the AZ ROC, therefore they are exempt from the bonding regulation. 

The charts below identify the AZ ROC’s various license classifications and the corresponding lines of work that can be performed under such licenses. 

Class NameClass Codes Prefix
Engineering Commercial ContractingA
General Dual Engineering ContractingKA
General Commercial ContractingB (-1, -2 only)
General Residential ContractingB
General Dual License ContractingKB
Specialty Residential ContractingR
Specialty Commercial ContractingC
Specialty Dual ContractingCR
License Classifications

Class NameClass Codes
General ContractorsB, B-1, B-2, B-3, KB-1, KB-2
General EngineeringA, B-4, KA
Acoustical systemsR-1, C-1, CR-1
Asphalt PavingA-14, R-13, CR-69
Awnings, Canopies, Carports, PatiosR-3, C-3, CR-3
BlastingR-15, C-15, CR-15
Boilers, Steamfitting, PipingR-4, C-4, C-74, CR-4, CR-74
CarpentryR-7, C-7, CR-7
Carpentry, Remodeling, Repairs (under $50k)R-61, C-61, CR-61
Comfort Heating, Ventilating, CoolingC-58, CR-58
ConcreteR-9, C-9, CR-9
DrillingA-4, R-53
DrywallR-10, C-10, CR-10
ElectricalR-11, C-11, CR-11
Electrical and Transmission LinesA-17
ElevatorsR-12, C-12, CR-12
Excavating, Grading, Oil SurfacingA-5, R-2, CR-2
FencingR-14, C-14, CR-14
Finish CarpentryR-60, C-60, CR-60
Fire ProtectionR-16, C-16, CR-16
FlooringR-8, C-8, CR-8
GlazingR-65, C-65, CR-65
Hardscaping and IrrigationR-21, C-21, CR-21
House MovingR-22
HVAC and RefrigerationR-39, C-39, C-79, CR-39, CR-79
InsulationR-40, C-40, CR-40
Lightweight PartitionsC-27
Low VoltageR-67, C-67, CR-67
MachineryCR-29
MasonryR-31, C-31, CR-31
Minor Home ImprovementR-62
Ornamental MetalsR-24, C-24, CR-24
Painting and Wall CoveringR-34, C-34, CR-34
Piers and FoundationsA-7
PlasteringR-36, C-36, CR-36
PlumbingR-37, C-37, C-77, CR-37, CR-77
Pre-manufactured SpasB-10
Refrigeration (Commercial Industrial)C-49
Reinforcing Bar and Wire MeshR-70, C-10, CR-62, CR-70
RoofingR-42, C-42, CR-42
Seal CoatingA-15, CR-66
Septic Tanks and SystemsR-41, C-41, CR-41
Sewers, Drains, Pipe LayingA-12, CR-80
Sheet MetalR-45, C-45, CR-45
SignsR-38, C-38, CR-38
Solar Plumbing Liquid SystemsC-78, CR-78
Steel and Aluminum ErectionA-11, R-17, CR-17
Swimming PoolB-5, B-6, A-9, A-19
Swimming Pool ServiceR-6, C-6, CR-6
TileR-48, C-48, CR-48
Water ConditioningR-54, C-54, CR-54
Water Well DrillingC-53, CR-53
WaterworksA-16
WeldingR-56, C-56, CR-56
WreckingR-57, C-57, CR-57
Contractor Classifications

Arizona Contractor License Bond Form