Ohio Private Water System Contractor Bond

Ohio Private Water System Contractor Bond

Contractors installing, servicing or repairing private water systems in Ohio need to have a Private Water System Contractor Bond in order to be registered with the Ohio Department of Health. Registration and the surety bond are required as part of state regulations to protect the public from damages arising from the work performed by these contractors.

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Jet Insurance Company provides this bond to contractors in Ohio, allowing them to fulfill this requirement. Jet is the only company to do so without middlemen (agents and brokers) who can only slow down the process and add unnecessary fees.

What Is Jet’s Cost for the Private Water System Contractors Bond?

There are two different required bond limits where Jet provides the lowest-priced bond. First, for contractors in business for three or more years, the bond limit is set at $10,000. The price for this bond starts at $10 monthly or $100 annually.

For new private water system contractors (up to the first three years in business), the bond limit is $20,000. Jet’s rates start at $15 monthly or $150 annually. Jet does offer multi-year bonds including a $375 3-year term, so you can purchase the bond and not worry about it until your bond limit drops.

Rates for the registration bond are dependent on the personal credit of the owner. Below are examples of the preferred pricing tier at Jet:

Years OperatingBond LimitMonthlyAnnual
Under 3 Years$20,000$15$150
Over 3 Years$10,000$10$100
Private Water Systems Contractor Bond Rates

The registration period for private water system contractors runs from January 1 to December 31. You can purchase the bond mid-term — Jet’s monthly option is a great way to only pay for what you need. Otherwise, Jet will just charge you a prorated amount for the partial term of the bond needed.

Why Does Ohio Require a Private Water System Contractor Bond?

The Ohio State Legislature made the Private Water System Contractor Bond a requirement (see the Ohio Administrative Code 3701-28) as a financial tool to protect the public from fraudulent behavior and poor workmanship from private water system contractors. Should a customer face damages resulting from a violation of the administrative code and the contractor fails to remedy the problem, a third-party surety company (Jet) will step in to make things right.

The Ohio Department of Health Private Water Systems Program is tasked with managing the  registration of contractors and enforcement of the private water system law. For the Department, not only does Jet deliver financial recourse when all else fails, but Jet provides assurance at the outset of the registration process that the contractor is a worthy individual or company by approving their bonding.

Bond Application Process With Jet

Apply online by clicking on the button above and, in minutes, you can have your bond purchase completed. Jet will need some basic information about your business and the owner’s name and social security number. We do run a soft credit check (which only takes a couple of seconds) to determine eligibility and rate.

You can always call us at 855-296-2663 and take care of the bond over the phone with one of our underwriters. 

How Does the Private Water System Contractor Bond Get Filed to the Department of Health?

We give you two options. First, you can elect to have Jet file the original bond to the Department of Health for you, saving on time and unnecessary costs shipping a piece of paper everywhere.

Or, you can have Jet ship the bond to you to file with the Department of Health. This is a good idea for first-time applicants who are submitting the registration packet to the Department. The registration packet for a specific year is found in the tab on the Department of Health website titled Contractor Registration To Work On A Private Water System

All documentation eventually needs to get to the following address:

State of Ohio Department of Health
BEHRP/Private Water Systems Program
P.O. Box 15278
Columbus, OH 43215-0278

What Happens if I Need to Cancel My Bond?

Just email us at bonddept@jetsurety.com to request bond cancellation. The bond does remain active for another 90 days following the receipt of that request, per the Ohio State statutes. Monthly payments must continue during that time. 

For bonds paid annually, we will send a prorated refund if one is available. Eventually, the bond will expire at the end of the registration period if your bond term is also set to expire that year.

Does the Private Water System Contractor Bond Obligation End?

When you are done working on private water systems in Ohio, you will no longer need to register or carry the surety bond. The surety bond does have a two-year tail of coverage for any job performed during that bond’s registration period — meaning, a contractor’s obligation to remedy a grievance exists for two years. Don’t sell your equipment just yet. 

Unlike most surety companies, Jet is not stuck in the mud when it comes to handling surety bonds requirements such as the Private Water System Contractor Bond. The registration and bond period beginning and ending at the end of the year is no cause for concern with Jet; you can get the bond term you’d like with worrying about unnecessary red tape surrounding surety bonds. This seemingly simple offer of terms seems like a luxury when you try purchasing a bond elsewhere, using brokers and agents. 

How Does a Contractor Avoid Complaints to the Department of Health?

Like all contracted work, to avoid the likelihood of a complaint, you must complete the contract on time and to the specifications that were agreed upon. We say “likelihood” because there is always that one customer that only expletives can describe. Situations can be made null even in the face of a complaint and subsequent investigation by the Department of Health if the contractor followed the code and standards found in the Ohio Administrative Code.

Once a written complaint is received by the Department of Health, they will first determine if the grievance has any validity. A snarky, trivial complaint will get tossed out. A valid complaint will spark an investigation. Be forthright with your information as you do not want to give the investigator any reason to make you the villain. 

If a violation is discovered, most likely you will be given a corrective action plan to take to remedy the damages caused. By law, the complainant must give you, the contractor, 30 days to resolve the situation, which probably means you have an opportunity to deal with the complainant face to face. The department director reserves the authority to rescind this right to take corrective action. 

Failure to remedy the situation will lead to severe consequences including, but not limited to, suspension, bond claim, fines and/or revocation of the registration. 

Don’t forget about the $500,000 general liability policy you are supposed to hold — that mandatory policy will pay for damages to structures or land (or even people) arising from work performed that are outside of the system you are installing or servicing. Be sure to check in with that policy to see if it will cover the grievance.

What Happens if I Get a Private Water System Contractor Bond Claim?

If you catch wind that a complaint is escalating to the level of a bond claim, contact Jet immediately and we will guide you through the process. The law demands that Jet make payment within 30 days upon receiving claim notice from the Department of Health. Typically, we are able to provide a defense, but in the face of legal action taken by the Department with the Code on their side, there is little Jet can do but make payment up to the bond’s limit. There would have to be evidence of government malfeasance for us to make a case against the Board’s determination. 

While Jet will bring restitution, the guilt of the original violation is not transferred to us. Jet and any other surety companies will demand payment back from the principal (private water system contractor). Outstanding bond claims will make it difficult to become registered with the Department of Health. A contractor may be granted a six-month corrective action plan if outstanding bond claims exist. If multiple bond claims are filed within a three-year period, that contractor is toast.

Are There Other Bonds That a Contractor Doing Private Water System Needs?

Give Jet a call if you land in a city, town or village with some obscure bonding requirement. Ohio has the largest amount of legislation in the United States requiring surety bonds for contractors and Jet Insurance Company is the expert for a multitude of contractor bonding needs.

Ohio Private Water System Contractor Bond Form