How to Become a Bonded Plumber

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What is a bonded plumber?

A bonded plumber is a contractor that has purchased and posted a surety bond. The plumber pays annual premiums to remain bonded. The bond ensures they perform their work effectively, follow industry laws and regulations, and pay applicable taxes and fees.

As a plumber, being bonded protects your customers and your governing authority if you damage property, don’t perform a job as promised, or fail to make required payments (for permits, to other technicians, etc.).

What is a plumbing bond?

Plumbing contractors in various states (including Iowa, Illinois, Minnesota, and New Jersey) must post a surety bond to become licensed to work legally. The bond ensures the plumber meets certain obligations and maintains professional standards on the job. It also protects consumers by holding the contractor accountable to its governing authority (the state, city, or county that requires the bond).

Get Your Plumbing Contractor Bond:

Quick Takeaways

  • A bonded plumbing contractor has purchased and posted a surety bond.
  • Plumbing contractors in Iowa, Illinois, Minnesota, and New Jersey must post a surety bond to become licensed to work legally.
  • As a plumber, if you break your surety bond contract terms and it costs a customer or the state money, you may face claims against your bond.
  • If you have good credit, you could pay as little as 1% of the total bond amount required in your location.

Why do plumbing contractors need to be licensed and bonded?

You may need to be licensed in your state or city to perform plumbing services there legally. To obtain your plumbing contractor license, you may also need to become bonded.

A license can help you build trust with consumers by ensuring you have the education and training needed to perform quality services. It will also hold your business accountable to regulatory boards.

In a nutshell, here’s how bonds and insurance differ:

  • Insurance: An insured plumber should have commercial liability insurance to cover property damage and bodily injury claims.
  • Insurance: A bonded plumber will post a surety bond that helps cover subpar work, stolen items, or damages resulting from illegal activity.

How does a plumbing bond work?

Plumbing bonds are three-party contracts between a principal, an obligee, and a surety.

  1. Principal: The plumbing contractor that must purchase and post a bond
  2. Obligee: The governing authority (state, county, or city) that requires the bond
  3. Surety: The financial institution that underwrites, issues, and backs the bond

As a plumber, if you break your surety bond contract terms and it costs a customer or the state money, you may face claims against your bond. If a claim is valid, you must compensate the injured party for their losses. If you don’t pay them upfront, your surety will cover the costs for you. You must later repay them in full.

Claimants may file claims up to the total amount of your bond. Avoid situations that may lead to claims and lawsuits to protect your reputation, business, and ability to get bonded again in the future.

Plumbing bonds can vary in cost based on where you plan to conduct business. In general, bond requirements in the U.S. can range from $3,000 to $25,000. You will pay a fraction of the bond amount based on your credit score and personal and business financials.

If you have good credit, you could pay as little as 1% of the total bond amount required. For example, if you need a $15,000 bond, you might pay $150 per year for your premium.

If you have bad credit, you may still be able to get the bond you need. ZipBonds works with a large pool of sureties across the United States, increasing your chances of getting bonded at an affordable rate.

How to Become a Bonded Plumber

We can help you find the right surety bond for your plumbing contractor business. ZipBonds offers the fastest and most secure option for getting bonded. Our all-digital platform is intuitive and straightforward. Apply online or call us at 888.435.4191 to speak with an agent directly.

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About ZipBonds.com

Founders Ryan Swalve and Zach Mefferd formed the vision for ZipBonds.com when they realized how overly complicated it was to help clients place surety. The frustration of being unable to incorporate the technology they’d used in other insurance-focused projects left them thinking “there has to be a better way.”

Fast forward a couple of years, and that better way is the impetus of everything we do at ZipBonds. We constantly look for innovative ways to improve the bonding process for our clients and agents. Our team comprises individuals who understand all angles of surety – for companies, agencies, and individuals. Incorporating everyone’s point of view to improve the process while simultaneously integrating cutting-edge technology is what sets our business apart.