Overview of Minnesota Contractor Bonding Requirements
A number of contractor classifications require a contractor license before they can legally operate in Minnesota. These include the following contractors:
- Plumbing
- Electrical/Elevator
- Sewage
- Mechanical
- Masonry
- Sidewalk
- Water conditioning
- Technology systems
Locations such as Brainerd, Minneapolis, and St. Paul, have supplementary requirements for some contractors as well.
Each type of bond has specific terms that you need to comply with. However, the purpose of all of these bonds is similar: to provide an extra layer of protection for project owners, and to guarantee the quality of work by contractors.
If the contractor has breached the terms of a contractor or has failed to comply with an applicable regulation, they can face a bond claim which will provide compensation to affected parties.
Continue reading for bond amounts and an overview of the bonding costs you can expect.
Minnesota Contractor Bond Cost
Each of these bonds has a specific bond amount set on a state or local level which refers to its maximum protection. In other words, if you post a $5,000 surety bond and there is a valid claim against you, it cannot exceed $5,000.
Below are bond amounts, as well as projected premiums based on credit score.
| Location | Bond Type | Surety Bond Amount | Above 700 | Between 650-699 | Between 600-649 | Below 599 |
|---|---|---|---|---|---|---|
| Statewide | Water Conditioning Contractor Bond | $3,000 | $100 | $100 | $100-$120 | $100-$150 |
| Statewide | Individual Sewage Treatment Contractor Bond | $10,000 | $100-$200 | $150-$300 | $200-$400 | $300-$500 | Statewide | Masonry Contractor Class A License Bond | $10,000 | $100-$200 | $150-$300 | $200-$400 | $300-$500 |
| Statewide | Residential Roofer Contractor Bond | $15,000 | $150-$300 | $225-$450 | $300-$600 | $450-$750 |
| Statewide | Technology System Contractor Bond | $25,000 | $250-$500 | $375-$750 | $500-$1,000 | $750-$1,250 |
| Statewide | Plumbing Contractor Bond | $25,000 | $250-$500 | $375-$750 | $500-$1,000 | $750-$1,250 |
| Statewide | Electrical Contractor Bond | $25,000 | $250-$500 | $375-$750 | $500-$1,000 | $750-$1,250 |
| Statewide | Mechanical Contractor Bond | $25,000 | $250-$500 | $375-$750 | $500-$1,000 | $750-$1,250 |
| St. Paul | Sidewalk Contractor Bond | $5,000 | $100 | $100-$150 | $100-$200 | $150-$250 |
| Minneapolis | Specialty Contractor Bond | $10,000 | $100-$200 | $150-$300 | $200-$400 | $300-$500 |
| Minneapolis | Sidewalk Contractor Bond | $15,000 | $150-$300 | $225-$450 | $300-$600 | $450-$750 |
These estimates are based on your credit score, the most important piece of information that surety bond companies examine. However, in some circumstances, the surety may look at additional factors. These include:
- Personal financial statements
- Business financial statements
- Business history/age
- Industry experience of the owner(s)
If you want to learn more, consult our surety bond cost guide, where you’ll find some useful tips on reducing your premium.
Information for Applicants with Bad Credit
Surety underwriters consider applicants with bad credit, no credit, or credit report issues (such as tax liens and civil judgments) as high-risk. This is why premiums are always higher if you fall under one of these categories.
Still, with our Bad Credit Program we can issue a bond for even the hardest cases, so you can rest assured your low credit score is not a problem. The only exception to this rule are applicants with open bankruptcies and late child support payments.
Apply and Get Bonded Today!
We have made our one-page application fast, secure and straightforward. All you need is five minutes to submit it– we take care of the rest.
One of our agents will work closely with you to answer all of your questions. We’ll help you with the paperwork, so there will be little else you need to do. After processing your payment, it takes no more than one or two business days to issue your bond.
Minnesota Contractor License Requirements
Posting a surety bond is just one requirement you need to satisfy as part of your licensing application. To become licensed as a contractor in Minnesota, you will need to submit an application, which you can do electronically. Your application will include information such as:
- Minnesota tax identification number (if required)
- Federal employer identification number (if required)
- Full legal name
- Social security number
- Business address
- Proof of active status of business filings with the Secretary of State
- Proof of compliance with insurance and employment laws
Your license expires on December 31 of odd years, and you shouldn’t forget to submit a renewal application well in advance: starting October but no later than December 1. Otherwise, your license may expire before the state has processed your renewal request.
At the time of submitting a renewal application, you must also have a valid contractors license bond if your contractor classification requires it.
