Overview of Alabama Surety Bonds

Surety bonds are frequently required in the state of Alabama of applicants for a business license. Bonds may also be required of contractors who wish to bid or perform on federal or state construction projects.

What’s the purpose of the bond?

Surety bonds are required as a form of guarantee that any bonded party will comply with state laws and regulations, such as the Code of Alabama, that concern their type of business.

Similarly, to perform work on certain construction projects, contractors are frequently required to obtain bonds that guarantee their compliance and performance according to the conditions of their project contract.

Bonds not only guarantee compliance but offer protection if the bonded party violates the conditions of the bond. If the bonded party violates the bond agreement and causes losses or damages, wronged parties can file a claim against the bond to request compensation.

See our detailed ‘What is a surety bond’ guide to learn more about how bonds work.

Read on for more information about the different types of surety bonds in Alabama, how much they cost and how you can apply.

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Types of Alabama Bonds

There are three main types of surety bonds that are issued for the state of Alabama:

  • license and permit bonds
  • contract bonds
  • court bonds

License & Permit Bonds

Alabama businesses who need to get licensed in order to operate lawfully are often required to obtain a license bond. To find out if you need to get bonded, contact the Alabama Department of Revenue or the Division which issues your type of business license.

This bond guarantees that you will conduct business in accordance with the provisions of the Alabama Code that apply to you.

If you are looking for a specific license bond in Alabama, you can search for your bond in the table below.

Find the Bond You Need

The table below contains a list of only the most popular surety bonds. If you can't find yours, fill out our online application and select "Not in the list".

Contractor License (No P&P Language) Bond State of Alabama Board for General Contractors General Contractor License Bond Apply Now
Contractor License (No P&P Language) Bond City of Birmingham City of Birmingham Contractor License Bond Apply Now
Contractor License (No P&P Language) Bond City of Dothan (City of Dothan, AL) Contractor License Bond Apply Now
Contractor License Performance & Payment (State) Bond Board of Heating, Air Conditioning, & Refrigeratio Heating, Air Conditioning, & Refrigeration Contrac Apply Now
Contractor License Performance & Payment (State) Bond Mobile Urban Development Department Urban Development Department Bond Apply Now
Contractor License Performance & Payment (State) Bond State of Alabama Plumbers & Gas Fitters Plumbing and or Gas Fitting Bond Apply Now
Investment Advisor (Blue Sky) Bond Securities Commission Uniform Surety Bond Apply Now
Professional Fund Raisers Bond Office of the Attorney General Prof. Fund Raiser or Comm. Co-Venturer Apply Now
Insurance Surplus Lines Brokers Bond Alabama Department of Insurance Insurance Surplus Lines Broker Apply Now
Mortgage Broker (1st & 2nd Mortgages) Bond State of Alabama, State Banking Dept SAFE Mortgage Act Bond Apply Now
Auto & Mobile Home Dealers (New & Used) Bond Dept. of Revenue Motor Vehicle Dealer Bond Apply Now
Auto & Mobile Home Dealers (Used Only, No New) Bond Alabama Dept of Revenue Used Motor Vehicle Dealer, Reconditioner, Rebuilde Apply Now
Motor Vehicle (Non-Dealer, Not Listed) Bond Alabama Department of Revenue Designated Agent Bond Apply Now
Motor Vehicle (Non-Dealer, Not Listed) Bond Alabama Department of Revenue Bond of Automotive Dismantler and Parts Recycler Apply Now
Motor Vehicle (Non-Dealer, Not Listed) Bond Manufactured Housing Commission AMHC License/Permit Apply Now
Motor Vehicle (Non-Dealer, Not Listed) Bond Alabama D.O.R. Motor Vehicle Division Designated Agent-Non Dealer Bond Apply Now
Sport Permits Bond ALABAMA ATHLETIC COMMISSION Promoter's License Bond Apply Now
Detectives Bond City of Florence Private Detective Bond (City of Florence, AL) Apply Now
Medicare & Medicaid (Home Agencies, State) Bond Alabama Medicaid Agency Alabama Medicaid Agency Bond Apply Now
Professional Licenses (All Other) Bond State Of Alabama Real Estate Appraisers Board Appraisal Management Company Registration Apply Now
Professional Licenses (All Other) Bond Alabama Department of Insurance Corporate Surety - Bail Bond Apply Now
Professional Licenses (All Other) Bond Department of Agriculture & Industries Subterranean Termite Eradication and Control Work Apply Now
Professional Licenses (All Other) Bond State of Alabama Dept. of Insurance Service Contract Provider Bond Apply Now
Schools (All) Bond Department of Post Secondary Education Private School Performance Bond Apply Now
Schools (All) Bond Department of Postsecondary Education Private School Agents Apply Now
Schools (All) Bond Board of Cosmetology School Property Bond Apply Now
Alcohol (Retailers) Bond Jefferson County Dept. of Revenue Selling Alcoholic, Spirituous, Vinous or Fermented Apply Now
Alcohol (All Others) Bond City of Priceville Alcohol Ordinance Tax of Fee Bond (Priceville, AL) Apply Now
Utility Deposit Bond ALABAMA POWER Indemnity Bond for Electric Service and/or Steam H Apply Now
Utility Deposit Bond Alabama Gas Corporation Indemnity Bond for Gas Service Apply Now
Utility Deposit Bond Huntsville Utilities Huntsville Utilities Bond Apply Now
Utility Deposit Bond Florence Utilities, City of Florence AL Florence Utilities Deposit Bond Apply Now
Utility Deposit Bond Decatur Utilities Payment of Utility Bills Bond (Decatur Utilities) Apply Now
Indemnity (Miscellaneous - Not Listed) Bond Connie S. Harris Private School Preformance Bond (Non-Degree Granti Apply Now
Money Transmitter Bond Alabama Securities Commission Money Transmitter Apply Now
Telemarketing/Phone Solicitor Bond Office of the Attorney General Telemarketing Apply Now
Telemarketing/Phone Solicitor Bond Office of the Attorney General, Consumer Protectio Telemarketing Bond Apply Now

Contract Bonds

Contract bonds, such as performance and payment bonds, are usually required by Alabama contractors when they begin work on a federal, state or private construction project.

Under the federal Miller Act and the Alabama Little Miller Act, to perform on construction projects over certain dollar amounts, contractors need to obtain bid, performance, and payments bonds.

Court Bonds

Court bonds are sometimes required by Alabama courts. When appealing a judgment, appellants may need to obtain an appeal bond. Fiduciaries in Alabama may also be required to post a fiduciary bond.

Can’t find what you are looking for? Call us at (866)-450-3412 to receive assistance and advice from one of our Alabama surety bond experts at Bryant Surety Bonds.

How Much Does it Cost to Get Bonded in Alabama?

How much your bond will cost is determined by the type of your bond and the bonding amount. All bonds have different amounts, and these are determined on a state level.

What is the difference between bond cost and bond amount?

The bond amount is the maximum amount of compensation guaranteed by the surety that issues your bond. In other words, this is the maximum amount of money the surety may provide to someone who files a claim against your bond. The cost of your bond is equal to a percentage of its amount.

For example, the Alabama auto dealer bond has a fixed amount of $25,000, as does the mortgage broker bond in the state. These amounts may differ in other states. The $75,000 freight broker bond, on the other hand, is fixed and has the same amount across all states

Contract bonds also have different amounts and these are determined by the specific project that contractors are obtaining a bond for.

What determines the cost of my bond?

Your bond’s cost or premium is a fraction of the full bond amount. It can vary between 1%-4% of the total bond amount for standard market rates and 5%-15% for applicants with bad credit.

How high your bond rate will be, depends on a series of financial factors that sureties take into account when reviewing your bond application. These factors are:

  • Personal credit score (most importantly)
  • Personal and business financials
  • Your industry experience
  • Other financial and business factors

Standard market rates are usually offered to applicants with a high credit score, one of 700 FICO or more.

Can I get bonded if I have a low credit score?

Yes, even if you have a low credit score or have no credit at all, you can still get bonded.

Applicants with less than perfect credit, bankruptcies or other financial difficulties are offered higher rates due to the higher risk involved in bonding them. Applicants like these can apply for a bond through the Bad Credit Surety Bond Program.

If such applicants improve their credit score over time, they can apply to get bonded at increasingly better rates.

To get an estimate on your surety bond rate in Alabama, try our surety bond calculator below!

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If you would like to find out more what sureties take into account when determining the rate of your bond, have a look at our highly informative Surety Bond Cost page.

How to Get Bonded in Alabama

There are two different ways of applying, depending on the type of surety bond you want to get.

License bond application

To apply for a license bond, complete our online surety bond form. You will soon be contacted by one of our experts with a free and exact quote on your commercial bond.

Once you’ve heard from us, you will need to supply us with a few more documents before we can underwrite your bond. The process is simple and straightforward.

Contract bond application

To apply for a contract bond, download, complete and send us the contract bond form that applies to you. Once we receive your form, we will contact you with more information about getting bonded.

If you require more information, you can always call us at (866)-450-3412 to consult one of your surety bond experts.

Further Reading


About the author:
Todd Bryant
Todd Bryant is a graduate of Germantown Academy and the University of Pittsburgh College of Business Administration Honors College. He has been President of Bryant Surety Bonds, Inc., an A+ rated Business with the Better Business Bureau, since 2007. Licensed as a producer with the Department of Insurance, he has been published in the National Association of Surety Bond Producers newsletter and on numerous authoritative publications such as The Washington Post, Entrepreneur.com, Azcentral.com and many more.