Higher contractor bonds to help consumers stuck with shoddy construction

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Washington consumers left with poor or unfinished construction projects will be able to collect more money from their contractor’s bond under a new law whose impact will grow over the next two years, according to a news release from Washington State Department of Labor & Industries.

Contractor bonds are like insurance for the customer — if contractors don’t fulfill their contract, the person who hired them can file a court claim and try to recover money from the bond.

A new state law that took effect July 2 raises the total amount of the bond that general construction contractors must have to register or renew their registration with L&I. The new bond amount is $30,000, more than double the previous amount of $12,000.

Bonds for specialty contractors (registered in one specialty like concrete or painting) are rising to $15,000 from the previous $6,000.

Electrical and plumbing contractors, who are licensed under different sets of laws, are not affected by the new bond requirements.

First bond increase in more than two decades

Construction contractors must register with L&I to work in Washington. The department confirms applicants have a bond, business license, liability insurance and meet other requirements.

This month’s bond increase marks the first time general and specialty contractor bond amounts have been raised since 2001.

The impact will be gradual. The state’s more than 67,000 general and specialty contractors are required to raise their bond when their individual registration comes up for renewal over the next two years. (To learn how the changes affect contractors, read the bond FAQs at Lni.wa.gov/RegisterAsAContractor).

“This is especially good news for consumers,” said Melissa McBride, L&I’s construction industries governance chief. “Some customers have paid tens of thousands of dollars for shoddy work, or no work at all, yet could only get back a fraction of what they’ve paid.

“Raising the bond will certainly help,” McBride said. “It’s important to note, though: Bond protections only apply if you hire a registered contractor.”

Check contractor bonds at ProtectMyHome.net

Consumers can check whether contractors are registered and the amount of their bond at ProtectMyHome.net or call 1-800-647-0982.

Contractor bonds are a financial guarantee, similar to an insurance policy, providing some financial recourse if contractors violate their contract with a customer. A contractor gets “bonded” by buying bond coverage from a bonding company.

Under state law, half of the bond is reserved for consumers, while construction workers, material suppliers, and taxing agencies may collect from the other half.

To collect from the bond, consumers must file a lawsuit against their contractor and the bond, and then win a court judgment. For more details, download “What to do if you want to file suit against your construction contractor” at Lni.wa.gov/go/F625-088-000.

Higher bonds are among several new protections for construction consumers

The 2023 state Legislature passed the law requiring the higher bond, along with several other provisions strengthening consumer protections when dealing with contractors.

For instance, in July 2026, homeowners who lose more money than a bond covers can seek additional reimbursement if the damage was caused by a registered contractor.

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