Quick Facts:

  • Regulating Agency: Hawaii Department of Commerce and Consumer Affairs (DCCA) Contractors License Board (CLB)
  • Required Bond Amount: $5,000 minimum (can be higher based on Board’s determination)
  • Cost Range: $100-$1,000 annually (depending on credit)
  • Required For: General Contractors (Type A & B) and Specialty Contractors (Type C) if required by the Board

What Is a Hawaii Contractor License Bond?

A Hawaii contractor license bond is a surety bond that guarantees a contractor will operate ethically and follow state laws. The bond protects consumers, employees, and the public from financial losses caused by a contractor’s failure to comply with licensing laws, pay workers, or fulfill contractual obligations. If a contractor violates regulations—for example, by abandoning a project or not paying subcontractors—affected parties can make a claim against the bond for compensation.

Who Regulates Hawaii Construction Contractor Licensing?

The Hawaii Department of Commerce and Consumer Affairs (DCCA) Contractors License Board (CLB) oversees contractor licensing in the state. This regulatory body enforces Chapter 444 of the Hawaii Revised Statutes, which governs contractor licensing requirements, including bonding obligations.

Official site: Hawaii DCCA Professional & Vocational Licensing – Contractors

What Bond Amount Is Required in Hawaii?

  • Standard license bond amount: $5,000 minimum by law
  • Additional requirements: The Contractors License Board determines the specific bond amount for each contractor on a case-by-case basis. The Board considers the contractor’s financial condition and experience when setting the amount.
  • Typical ranges: While $5,000 is the minimum, many contractors are required to post bonds of $10,000, $20,000, or more depending on their specific circumstances and the projects they handle.

How Much Does a Contractor Bond Cost in Hawaii?

  • Pricing range: $100-$1,000 annually for most contractors
  • Factors impacting cost:
    • Credit score (primary factor)
    • Business financial strength
    • Years of experience in the field
    • Past claims history
    • Bond amount required
  • Credit requirements:
    • Good credit (650+): Typically pay 1-3% of bond amount annually
    • Fair credit (600-649): Typically pay 3-5% of bond amount
    • Poor credit (below 600): May pay 5-10% of bond amount

For example, a $10,000 bond might cost around $100-$300 annually for a contractor with excellent credit, while a contractor with poor credit might pay $500-$1,000 for the same bond.

Who Needs a Contractor License Bond in Hawaii?

  • General Engineering Contractors (Type A) – If required by the Board
  • General Building Contractors (Type B) – If required by the Board
  • Specialty Contractors (Type C) – If required by the Board

In practice, the Contractors License Board commonly requires all new licensees to obtain a bond before their license is issued. The bond requirement applies whether the contractor works on residential or commercial projects.

What Other Contractor Bonds Are Required in Hawaii?

  • Roofing Guarantee Bond: Required specifically for roofing contractors who offer workmanship warranties exceeding 7 years. This bond must equal the full replacement value of the roof and is separate from the standard license bond.
  • Performance Bonds: While not a licensing requirement, these may be required for specific public works projects.
  • Payment Bonds: May be required for certain government contracts to ensure subcontractors and suppliers are paid.

How Does ContractorNerd’s Application Process Work?

  1. Complete a simple online application – Takes just 5 minutes
  2. Receive multiple quotes instantly – Compare rates from different surety providers
  3. Select your preferred quote – Choose the best option for your situation
  4. Pay online – Secure payment processing
  5. Get your bond documentation – Emailed to you immediately upon approval

How Quickly Can I Purchase a Bond?

Bonds can typically be issued the same day you apply. With our quote system, you’ll receive instant pricing options and can complete the entire process in minutes. Once approved, your bond documentation will be emailed to you immediately.

Who Files the Bond With the HI Once It Is Purchased?

You are responsible for filing the original bond form with the Hawaii DCCA Professional & Vocational Licensing Division. The surety company will provide you with the properly signed and sealed bond form, which you must submit to the Contractors License Board. Your license will not be activated until the Board receives the bond documentation.

Our partner can provide guidance on this process and ensure you have all the required documentation properly completed.

How Are Claims Handled on a Hawaii Contractor Bond?

If a contractor violates licensing laws or fails to meet obligations, affected parties can file a claim against the bond. Here’s how the process works:

  1. The injured party files a claim with the surety company
  2. The surety investigates the claim to verify its validity
  3. If the claim is valid, the surety pays the claimant up to the bond amount
  4. The contractor must reimburse the surety company for all paid claims

Claims against contractor bonds typically involve unpaid wages, substandard work, or contract violations. Hawaii law gives unpaid wages priority over all other claims against a contractor’s bond.

Frequently Asked Questions (FAQ)

Can I get a bond with bad credit?

Yes. While credit is a significant factor in determining bond rates, contractors with poor credit can still obtain bonds. The premium will be higher (potentially 5-10% of the bond amount), but many surety companies offer programs specifically for contractors with credit challenges.

What happens if I don’t maintain my bond?

If a required bond is not maintained, your contractor’s license is automatically forfeited. Hawaii law mandates continuous bond coverage for as long as the Board requires it. If your bond is canceled or expires, you have 60 days to reinstate it before losing your license.

When do I need to renew my bond?

Contractor license bonds in Hawaii typically follow a one-year or two-year term. The bond must be renewed before its expiration date to maintain continuous coverage. Many contractors align their bond renewal with their license renewal cycle, which occurs every two years on September 30 of even-numbered years.

What’s the difference between a bond and insurance?

A bond primarily protects your customers and the public, while insurance protects you and your business. Your bond is a guarantee that you’ll follow the law and fulfill obligations—if you don’t, the surety pays for damages and then collects from you. Insurance, on the other hand, covers specified losses without requiring repayment from you.

Ready to Get Your Hawaii Contractor License Bond?

Apply Now