How To Become Bonded As An Independent Contractor
It is an easy task for a registered company to become bonded but when it comes to independent contractors, it becomes a little tricky. Surety bond is a proof that an independent contractor is reliable and will complete the project or contract in a pre-defined manner. Becoming a bonded while remaining as an independent contractor requires many things that contractor needs to complete.
Surety bonds provide a financial security to the client who feels safe that his amount will not get wasted on the project or contract. These bonds ensure that the independent contractor will complete the project according to the obligations of the contract. Many municipal, state and federal contracts need independent contractors to complete their projects and they also obtain a surety bond as a mandatory part of their project.
However, it solely depends on the will of the client who wants to get his project completed through an independent contractor. If you are an independent contractor and want to become bonded then keep reading this post which will let you know how to do that.
Instructions
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First of all, you should contact your insurance company which will tell you if you need to be bonded or not. The reason is that it is not the requirement of all companies to be bonded. However, business insurance is the best solution for any independent contractor in this regard.
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Make sure that you keep a good record of your previous work and also avoid any sort of corruption. Keep your record clean as those companies who provide surety bonds will see your criminal history and can reject your request if you have a bad record.
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Also try to maintain your financial record and present it to the company that issues bonds if they request you to show your history.
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Now you should consult with the licensing and regulations department to verify the requirements of the bond. You will easily become bonded if your profession needs a state license and you are fully eligible for that.
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Now if your client wants a surety bond from you, then call your insurance agent and request for a surety bond.
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However, if you are an American and do not get the bond locally from your state, you should contact to the U.S. Small Business Administration (SBA). The SBA issues surety bond that cover 70 to 90 percent of the surety risk of the independent contractor.
