Contractor License Bond in Arkansas

What this bond requires in Arkansas

Commercial contractors performing work of $50,000 or more on a commercial project must be licensed by the Arkansas Contractors Licensing Board. A $10,000 corporate surety or cash bond is required under Ark. Code Ann. § 17-25-401 et seq. and must be continuous and maintained for the life of the license. The bond names the State of Arkansas as obligee for the benefit of persons damaged by the contractor breach of construction contract or labor/materials contract. Only an Arkansas resident or non-resident agent licensed by the Arkansas Insurance Department may execute the bond.

Who requires it

The contractor license bond is required by the Arkansas Contractors Licensing Board (CLB), Arkansas Department of Labor and Licensing under Ark. Code Ann. § 17-25-401 et seq. (State Contractors Bond Law); commercial licensing under Ark. Code Ann. §§ 17-25-101 to 17-25-315.

How to file in Arkansas

Submit the commercial license application to the Arkansas Contractors Licensing Board along with the $10,000 surety bond on the Board bond form, signed by an Arkansas-licensed surety agent and naming the State of Arkansas as obligee. The bond is filed in the principal/EIN name as registered with the Arkansas Secretary of State and must remain continuous for the duration of the license.

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FAQ

Common questions

Is a contractor license bond required in Arkansas?

Yes. Arkansas requires contractor license bonds issued by an admitted surety. The required amount is $10,000.

How much is the bond in Arkansas?

The bond amount is $10,000. Your annual premium is a small percentage of that, based on credit and experience.

Who requires the bond?

The bond is required by the Arkansas Contractors Licensing Board (CLB), Arkansas Department of Labor and Licensing.

How is the bond filed?

Submit the commercial license application to the Arkansas Contractors Licensing Board along with the $10,000 surety bond on the Board bond form, signed by an Arkansas-licensed surety agent and naming the State of Arkansas as obligee. The bond is filed in the principal/EIN name as registered with the Arkansas Secretary of State and must remain continuous for the duration of the license.

What does the bond cover?

Surety bonds protect the obligee, not the principal. If you fail to meet the obligation the bond guarantees, the surety pays the claim and recovers from you.

Is a surety bond the same as insurance?

No. Insurance protects you. A surety bond protects whoever required the bond. You repay the surety for any claim they pay.