Securing an Arizona Contractor License Bond is a crucial step for any professional looking to operate legally and confidently in the state’s construction industry. Our complete guide will walk you through everything you need to know about Arizona Contractor License Bond requirements, from understanding why the bond is necessary to a breakdown of current guidelines and eligibility criteria.

Whether you’re a new contractor applying for your first license or an experienced professional renewing your credentials, we’ll cover how to purchase a Contractor License Bond—including convenient online options—and provide direct access to the forms and resources you need. You’ll have a clear road map for meeting Arizona’s bonding requirements and protecting your business, your clients, and your reputation.

Does Arizona Require a Contractor’s License?

The Arizona Registrar of Contractors (AROC) requires a contractor license for projects over $1,000 or any project that requires a permit, regardless of price.

Importance of Arizona Contractor Bonds

Without the appropriate Arizona Contractor Bond, which is part of the licensing process, individuals can face severe penalties. Unlicensed, unbonded contractors are unable to establish a mechanic’s lien and are prohibited from pursuing payment for work that requires a license. A mechanic’s lien is a legal claim that contractors, subcontractors, laborers, or material suppliers can file against a property when they haven’t been paid for work or materials provided.

Moreover, an Arizona Contractor Bond safeguards clients, builds trust, and strengthens a contractor’s reputation and standing in the market. With an Arizona Contractor Bond, you:

  • Provide financial protection to homeowners, property owners, and project developers if you perform defective work, violate Arizona’s construction laws, or fail to meet contract terms.
  • Demonstrate credibility and professionalism, providing clients with confidence that you comply with Arizona law and are accountable for your actions.
  • Gain more bidding and growth opportunities, as you can take on larger projects, expand your footprint into other areas (such as residential and commercial), and qualify for permits.
     

Arizona Contractor Bond Requirements

LICENSE TYPE

CONTEMPLATED GROSS VOLUME (PER LICENSE)

BOND AMOUNT

Residential General Contractors

Less than $750,000

$9,000

$750,000 or more

$15,000

Residential Specialty Contractors

Less than $375,000

$4,250

$375,000 or more

$7,500

Commercial General Contractors (Includes General Engineering Contractors)

$150,000 or less

$5,000

Over $150,000 but not more than $500,000

$15,000

Over $500,000 but not more than
$1 million

$25,000

Over $1 million but not more than
$5 million

$50,000

Over $5 million but not more than
$10 million

$75,000

Over $10 million

$100,000

Commercial Specialty Contractors

$150,000 or less

$2,500

Over $150,000 but not more than $500,000

$7,000

Over $500,000 but not more than
$1 million

$17,500

Over $1 million but not more than
$5 million

$25,000

Over of $5 million but not more than $10 million

$37,500

Over $10 million

$50,000

Dual License Bond amounts are calculated by combining the amount required for Residential and Commercial Bonds.

Who Needs an Arizona Contractor License Bond?

In addition to getting an Arizona contractor license, individuals must also obtain and submit proof of a Contractor License Bond. This typically applies to all residential and commercial contractors conducting business in the state. Those who work on both residential and commercial projects need to purchase both a Residential and a Commercial Bond or acquire a Dual Contractor Bond, which covers both types of work.

Some contractors are also required to obtain a Taxpayer Bond.

Types of Arizona Contractor Bonds

The following are the types of Arizona Contractor Bonds you can apply for:

  • Residential License Bonds: For contractors building or repairing any residential property; includes general and specialty contracting work.
  • Commercial License Bonds: For contractors building, altering, or repairing any commercial property or supervising subcontractors working on a property; includes general and specialty contracting work.
  • Dual License Bonds: For contractors engaged in both commercial and residential work; includes general, specialty, and engineering contracting work.
  • Taxpayer Contractor Bonds: For new contractors, out-of-state contractors who don’t have a principal business location in Arizona, certain contractors with construction contracts valued at $50,000, dealers of manufactured homes, and contractors who have been delinquent in paying taxes in Arizona.

Other types of Arizona Contractor Bonds include Contract Bonds (Bid, Performance, and Payment), Permit Bonds, Subdivision or Site Improvement Bonds, and Commercial Miscellaneous Bonds.

How to Get an Arizona Contractor License Bond

The following are licensing and bond requirements and the application process for Arizona contractors:

Licensing Requirements

  • You must be 18 years or older.
  • Determine your business entity: LLC, corporation, sole proprietorship, or partnership.
  • Apply for a federal Employer Identification Number (EIN) from the Internal Revenue Service.
  • Identify a qualifying party who meets the experience and examination requirements for the license. The qualifying party can be either a person involved in the leadership of the business entity or an employee of the business. He or she may be a sole proprietor, one of the partners of a partnership, one of the members of a limited liability company, one of the officers of a corporation, or an employee of the contracting business. A person must meet the license classification requirements to be approved as a qualifying party. These include a minimum number of years of experience and successfully passing the required exams.
  • Choose your classifications. Depending on the classification and the type of license you’re applying for, minimum work experience and exam requirements exist.
  • Pass Arizona’s Statutes and Rules Exam (SRE), trade exam, or both. The SRE is not waived.
  • Submit a background check.
  • Submit a government-issued ID (driver’s license, birth certificate, U.S. passport, certificate of naturalization, etc.).
  • Obtain and submit proof of a completed Contractors License Bond. The value of the bond depends on the license you apply for and the gross volume of work you expect to complete in a year.
  • Obtain Workers’ Compensation insurance if you hire employees and provide a certificate of insurance that shows proof of coverage.

Bond Requirements

  • The entity name on the bond should match the entity listed on your license application, including your DBA
  • A list of contractor classifications
  • Separate the penal sums for Dual licenses (residential and commercial)
  • Effective date of the bond should be within 6 months
  • A notarized signature of the attorney-in-fact and the official seal of the surety company

Application Process

Complete and submit the application:

  • Log in to the ROC Online Customer Portal
  • Create an account here, or download and mail the Application Form to:
    Registrar of Contractors,
    P.O. Box 6748,
    Phoenix, AZ 85005-6748
  • Or deliver the application to 1700 West Washington Street, Suite 105, Phoenix, AZ 85007-2812

Required Forms and Documentation

  • Legal entity papers: proof of your company’s legal structure
  • Copy of background check
  • Government-issued photo ID
  • Completed License Application form
  • Scores from your Arizona Trade and Business Management exam
  • Experience and project documentation forms
  • Proof of Contractors License Bond
  • Proof of Workers’ Compensation insurance (if applicable)

Arizona Contractor License Bond Cost

The required Arizona Contractor License Bond amount is set by the Registrar of Contractors based on your license type and prior-year gross volume. Residential bonds range from $4,250 to $15,000, commercial specialty bonds from $2,500 to $50,000, and commercial general bonds from $5,000 to $100,000. If you hold a dual license, you must carry both the residential and commercial bond, and the amounts are added together. Your actual cost is the bond premium, a small percentage of the required amount, determined by credit and underwriting.

Factors That Affect Arizona Contractor Bond Pricing

Your personal credit score is the most important factor that influences the bond cost. Other finances, such as financial statements or your fixed and liquid assets, are also typically taken into account.

Maintaining and Renewing Your Arizona Contractor Bond

To keep your Arizona contractor license active, you must maintain a valid Contractor License Bond on file with the AROC at all times. Your bond must remain active and continuous for your license to stay in good standing with the AROC. Contractor bonds must be renewed before expiration.

Frequently Asked Questions About Arizona Contractor License Bonds

How quickly can I get proof of my Arizona Contractor License Bond from CCIS Bonds?

CCIS Bonds makes the license bond process easy. We offer an online form that allows you to obtain a same-day quote and purchase a bond in just a few simple steps.

Does my Arizona Contractor License Bond renew automatically, or do I need to reapply each year?

You must renew your license every two years. CCIS Bonds offers an online form, making the bond renewal process easy, too.

What happens if a claim is made against my Contractor License Bond?

If a claim is made against your Contractor License Bond, the surety company will investigate the complaint and may pay the claimant if the claim is valid. You're then required to reimburse the surety for any amount paid.

Note: Please review all applicable state laws and regulations or consult with your legal professional concerning your compliance as to your business operations.