Virginia Contractor License Bond
By Jeremiah Hart, Head of Surety Underwriting · Published October 29, 2026
Virginia Class A and Class B contractors can file a $50,000 surety bond with the DPOR Board for Contractors as an alternative to demonstrating net worth. The bond runs for a two year term and the premium is determined by a soft credit check. Contractors and agents can apply online and issue the bond in minutes.
What is a Virginia contractor license bond?
A Virginia contractor license bond is a $50,000 surety bond that Class A and Class B contractors can file with the DPOR Board for Contractors instead of proving minimum net worth. It guarantees that the contractor will follow Virginia’s contractor laws and Board regulations. If a customer wins a court judgment for improper or dishonest conduct and the contractor doesn’t pay it, the customer can recover from the bond, up to its limits. The bond involves three parties: the contractor (the principal), the surety that issues the bond, and the people of the Commonwealth, whom the bond protects.
Key facts
| Bond amount | $50,000 |
| Who needs it | Class A and B applicants or licensees who choose the bond instead of documenting net worth ($45,000 for Class A, $15,000 for Class B) |
| Filed with | Virginia Department of Professional and Occupational Regulation (DPOR), Board for Contractors |
| Required form | DPOR Surety Bond Form A501-27BOND |
| Term | Two years, expiring the last day of the month to match the license; continuous until cancelled |
| Claim limits | $20,000 per transaction; $50,000 aggregate for the life of the bond |
| Cancellation | 30 days' written notice from the surety to the Board |
| Typical cost | Determined by owner’s credit, typically ranges from 1%-10% annually |
| How to buy | Contractors apply online; agents apply for clients or embed the Circle Surety storefront on their own site |
| Governing Statute | Va. Code §§ 54.1-1106, 54.1-1108 and 54.1-1120.1 |
Who needs a Virginia contractor license bond?
Virginia licenses contracting firms in three classes based on project size and yearly volume. The bond only applies to Class A and Class B if the licensee or applicant chooses to post the bond in lieu of demonstrating net worth to the VA DPOR. The single / aggregate thresholds for the three licenses are listed below:
| License class | Single contract or project limit | Total in any 12 months | Financial requirement |
|---|---|---|---|
| Class A | $150,000 or more | $1,000,000 or more | $45,000 net worth or $50,000 bond |
| Class B | $30,000 to under $150,000 | $250,000 to under $1,000,000 | $15,000 net worth or $50,000 bond |
| Class C | Over $1,000 to under $30,000 | Under $250,000 | None |
These thresholds took effect July 1, 2025. Older guides that list $120,000 / $750,000 for Class A are out of date. Some Virginia localities also set their own contractor or permit bonds; check with the city or county where you work.
How much does a Virginia contractor license bond cost?
The premium for a Virginia contractor license bond ranges between 0.75% - 10% annually. Contractors pay the premium up front for the two-year term. The final rate is based on the owner’s credit and experience.
| Owner credit | Typical rate (per year) | Est. premium, 2-year term |
|---|---|---|
| Excellent (700+) | 0.75% – 1.5% | $750 – $1,500 |
| Good (650–699) | 1.5% – 3% | $1,500 – $3,000 |
| Fair (600–649) | 3% – 5% | $3,000 – $5,000 |
| Challenged (below 600) | 5% – 10% | $5,000 – $10,000 |
Circle Surety can provide instant quotes for these and many other bonds through our online portal.
How to get a Virginia contractor license bond
- Confirm the class. Make sure the firm is applying for or renewing a Class A or Class B license and wants to use the bond instead of documenting net worth
- Gather the firm details. Use the firm's exact legal name and address as they appear on the DPOR application
- Apply online. Fill out the short form below, as the contractor or on your client's behalf. A soft credit check is required to determine the final premium.
- Pay and receive the bond. The bond is issued on DPOR form A501-27BOND with the surety's power of attorney. This usually only takes a few minutes after payment is completed. These bonds can often be issued without the need for a signed indemnity agreement.
- Sign and notarize. A member of the contracting firm's Responsible Management signs the bond in front of a notary
- File with DPOR. Submit the original bond with to the Board for the Contractors license application or renewal
Requirement details
Bond vs. net worth
Class A and B firms prove financial responsibility in one of three ways: the Board's financial statement form (A501-27FINST), a CPA-reviewed or audited statement, or the $50,000 bond. The bond keeps a contractor’s financials private and frees up working capital. Additionally, it is often the fastest route for newer firms. It can also be used at renewal, and a firm that later meets the net worth minimum can switch to a financial statement.
Bond form and signatures
The DPOR only accepts bonds that use DPOR form A501-27BOND. The contractor is the principal, and the bond must be signed by a member of Responsible Management and notarized. The surety's attorney-in-fact signs a separate notarized affidavit and attaches a power of attorney to the bond form.
Term and renewal
The bond is written for two years, ending on the last day of the month to match the contractor’s license. It can't expire before the license it supports and stays in force until cancelled. A contractor can keep using the bond at each renewal, or switch to a financial statement once they meet the net worth minimum.
Cancellation
The surety may cancel only by giving the Board 30 days' written notice, sent by registered mail or personal service. The surety stays liable for any losses that happen before the cancellation takes effect. Contractors should replace the bond or file financials before that date to keep their license in good standing.
Claims: what the bond covers
- Who can claim: someone who wins a court judgment against the contractor for improper or dishonest conduct and isn't paid
- Eligibility: the claimant must meet the Virginia Contractor Transaction Recovery Fund eligibility rules
- Deadline: suit on the bond must be filed within 12 months after the judgment becomes final
- Limits: up to $20,000 per transaction and $50,000 total, no matter how many claims or years
- What's paid: actual monetary loss, court costs and attorney fees in the judgment. Interest and punitive damages aren't covered
- Board notice: the surety must tell the Board when a claim is made, when it's paid, and if the bond is cancelled
- Your obligation: a bond isn't insurance for the contractor. If the surety pays a claim, the contractor must repay it. Agents should make this clear to clients before issuance
Sources
- Va. Code § 54.1-1100 — Definitions (license class thresholds)
- Va. Code § 54.1-1106 — Class A license; financial responsibility and bond
- Va. Code § 54.1-1108 — Class B license; financial responsibility and bond
- Va. Code § 54.1-1120.1 — Recovery on bond
- 18VAC50-22-50 — Requirements for a Class B license
- 18VAC50-22-60 — Requirements for a Class A license
- DPOR Surety Bond Form A501-27BOND
- DPOR Financial Statement Form A501-27FINST
- DPOR Board for Contractors
Frequently asked questions
How much does a Virginia contractor license bond cost?
The premium for a Virginia contractor's license bond is a percentage of the $50,000 bond amount, paid for the two year term of the bond. The final cost is determined by a soft credit check. Contractors with strong credit typically pay about $750–$1,500 for the two-year term, while applicants with lower credit scores pay more. Circle Surety has access to multiple markets and can provide a competitive rate in minutes.
How can my agency offer Virginia contractor license bonds?
Circle Surety partner agencies can embed an automated storefront on their own agency website, so contractor clients apply and buy the bond without leaving it. Agents can also apply on a client’s behalf, and bonds are usually issued within a few minutes. Contractors who apply with Circle Surety directly are assigned a partner agency to service their bond.
Can a contractor get a Virginia contractor bond with bad credit?
Contractors with bad credit can usually still get quotes for Virginia contractor license bonds, although they will pay more in premium. The final premium is determined by the owner's credit score and experience. Circle Surety works with several different markets and can provide competitive quotes even when an applicant has poor credit or thin financials.
What does an agent need from a contractor to issue the bond?
Agents that want to quote a Virginia contractor license bond will need the the firm's exact legal name and address as they appear on the DPOR application. They will also need the license class, and the owner's details for the soft credit check. If an agent does not have all of this information, they can send their client a link to finish the application directly from the Circle Surety application.
Is a contractor license bond required in Virginia?
Contractor license bonds are an optional requirement in Virginia that a contractor can use in lieu of providing financials to the DPOR when applying for a Class A or B license. Class C contractors have no net worth or bond requirement.
Jeremiah Hart is the Head of Surety Underwriting at Circle Surety. He has previous experience as a Territory Underwriter at BondExchange and as the Commercial Surety Manager at Universal Shield Insurance Group.
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