Alaska Contractor License Bond Overview
The Alaska Department of Commerce, Community and Economic Development is the state authority that requires some Alaska contractors to get bonded before they can legally work in the state.
Simply put, the contractor license bond is required so that contractors will comply with all applicable rules and regulations, such as building codes when performing work on a project. This way, project owners, the public, and the state get an extra layer of protection in case they suffer losses as a result of contractor’s negligence or noncompliance with the law.
Contractors should take great care to acquaint themselves with Alaskan laws in order to stay out of costly claims. More specifically, Alaska Statutes, Title 8, Chapter 18, contains important provisions that Alaskan contractors must comply with.
Read more to learn about these bonds, which contractors need them, and what the required bond amounts are.
What’s the cost of a contractor license bond in Alaska?
The cost you will need to pay depends first on the mandated total amount of your bond. Your yearly premium is a percentage of the bond amount, calculated based on your credit score, business’s financials, and other factors. The table below contains detailed information on the required total amounts (i.e., the maximum protection of the bond) by license type, as well as expected yearly premiums based on your personal credit score.
|License type||Surety Bond Amount||Above 700||Between 650-699||Between 600-649||Below 599|
|All contractors (aggregate project price of $10,000 or less)||$5,000||$100||$100-$150||$100-$200||$150-$250|
|Mechanical and Specialty Contractors; Home Inspectors||$10,000||$100-$200||$150-$300||$200-$400||$300-$500|
If you credit score isn’t perfect, check out our surety bond cost guide for some useful tips on reducing your premium, using additional information about you and your business.
Bad Credit Program
Applicant whose credit score is low can apply through our Bad Credit Program. We have forged strong relationships with the strongest bonding companies in the U.S., which allows us to negotiate the best rate for you.
Applicants with bad credit typically pay a higher premium, because the surety assumes a higher risk and offsets it by quoting at a higher rate. However, in all but a few cases, your credit issues will not prevent you from getting bonded.
An exception to this rule are applicants with open bankruptcies, or those late with child support payments.
Get your contractor bond today!
You can start your application now, and you’ll receive your free bond quote in no time. At just a page, our application is among the easiest to fill out. If you provide ownership information, we can provide you with a more exact quote.
Afterwards, our agents will take your through the whole process and help you fill out the necessary paperwork. Once we have everything we need, we can get the surety’s signature in as little as 1-2 business days.
Tips on Staying out of Bond Claims
Alaska contractors need to be well aware of their obligations under the bond agreement. A violation can lead to a claim, which can be not only time-consuming, but costly.
In accordance with the bond language, you are required to declare and pay taxes on time, provide timely payment to the people you work with, and perform your work in line with all contracts you enter.
If you are notified of a valid claim, you must pay it before it goes to court. Learn more about the subject with our surety bond claims guide.
Still have questions about becoming a bonded contractor in Alaska? Call us at (866)-450-3412 - our experts are here to help.