Washington Electrical/Telecommunications Contractor Bond: A Comprehensive Guide

January 4th, 2021

This guide provides information for insurance agents to help contractors on Washington Electrical/Telecommunications Contractor bonds

At a Glance:

• Average Cost: $100 – $400 per year, based on the contractor’s credit score
• Bond Amount: $4,000
• Who Needs It: All individuals and businesses that act as electrical or telecommunications contractors in the State of Washington
• Purpose: To ensure the public will receive compensation for any damages should the contractor fail to comply with contractor registration law
• Who Regulates Contractors in Washington: The Washington Department of Labor and Industries (DOLI)

Background

Washington RCW 19.28.420 requires all electrical and telecommunications contractors in the state to obtain a license with the DOLI. The Washington legislature enacted the licensing laws and regulations to ensure that contractors engage in ethical business practices. In order to provide financial security for the enforcement of the license law, contractors must either obtain an assignment of savings or purchase and maintain either a $4,000 electrical/telecommunications contractor surety bond to be eligible for licensure.

What is the Purpose of the Washington Electrical/Telecommunications Contractor Bond?

Washington requires electrical and telecommunications contractors to purchase the Electrical/Telecommunications Contractor Bond as part of the application process for both the electrical and telecommunications contractor license. The bond ensures that the public will receive compensation for financial harm if the contractor fails to comply with the licensing regulations. In short, the bond is a type of insurance that protects the public if the contractor breaks licensing laws.

How Can an Insurance Agent Obtain a Washington Electrical/Telecommunications Contractor Surety Bond?

BondExchange makes obtaining a Washington Electrical/Telecommunications Contractor bond easy. Simply login to your account and use our keyword search to find the “contractor” bond in our database. Don’t have a login? Enroll now and let us help you satisfy your customers’ needs. Our friendly underwriting staff is available by phone (800) 438-1162, email or chat from 7:30 AM to 7:00 PM EST to assist you.

At BondExchange, our 40 years of experience, leading technology, and access to markets ensures that we have the knowledge and resources to provide your clients with fast and friendly service whether obtaining quotes or issuing bonds.

Is a Credit Check Required for the Washington Electrical/Telecommunications  Contractor Bond?

Surety companies will run a credit check on the owners of the contractor company to determine eligibility and pricing for the Washington Electrical/Telecommunications Contractor bond. Contractors with excellent credit and work experience can expect to receive the best rates. Contractors with poor credit may be declined by some surety companies or pay higher rates. The credit check is a “soft hit”, meaning that the credit check will not affect the contractor’s credit.

How Much Does the Washington Electrical/Telecommunications Contractor Bond Cost?

The Washington Electrical/Telecommunications Contractor surety bond can cost anywhere between $100 to $400 per year. Insurance companies determine the rate based on a number of factors including your customer’s credit score and experience. We also offer easy interest-free financing for premiums over $500. The chart below offers a quick reference for the approximate bond cost on the $4,000 bond requirement.

*The credit score ranges do not include other factors that may result in a change to the annual premium offered to your customers, including but not limited to, years of experience and underlying credit factors contained within the business owner’s credit report.

How does Washington Define “Electrical Contractor”?

Washington RCW 19.28.006 defines an electrical contractor as any “person, firm, partnership, corporation, or other entity that offers to undertake, undertakes, submits a bid for, or does the work of installing or maintaining wires or equipment that convey electrical current.

How Does Washington Define “Telecommunications Contractor”?

Washington RCW 19.28.400 defines a telecommunications contractor as any “person, firm, partnership, corporation, or other entity that advertises, offers to undertake, undertakes, submits a bid for, or does the work of installing or maintaining telecommunications systems.”

How Do Electrical Contractors Apply for a License in Washington?

Electrical contractors in Washington must navigate several steps to obtain a license. Below are the general guidelines, but contractors should refer to the DOLI’s Electrical Contractor Page for details on the process.

*Contractors who perform additional services not related to electrical or telecommunications work will need to register as a contractor and obtain a Contractor License Surety Bond

License Period – The Washington Electrical Contractor License is valid for two years from the date of issuance and must be renewed before the expiration date

Step 1 – Determine the License Type

Washington requires electrical contractors to obtain specific licenses corresponding to the nature in which the contractor’s business operates. Below are the different types of the Washington Electrical Contractor License:

• • General – Can perform all electrical work without limitations
  • Specialty – Can only perform work specific to the contractor’s designated specialty. Electrical contractors find a full list of all 14 specialty classes here

Step 2 – Obtain a UBI Number

Electrical contractors must obtain a valid UBI number from either the Business Licensing Service or Washington Secretary of State

Step 3 – Hire a Certified Administrator

All license applicants must have a certified electrical administrator listed on their application. The administrator must be a full time employee of the contractor company and cannot serve as an administrator for multiple firms. In order to become an administrator, the applicant must pass the electrical administrator exam. Administrators can read the full exam requirements here.

Step 4 – Purchase a Surety Bond or Obtain an Assignment of Savings

Contractors must obtain an assignment of savings or purchase and maintain a $4,000 electrical/telecommunications contractor surety bond.

Step 5 – Complete the Application

All electrical contractor regulatory license applications should be mailed to:

Department of Labor & Industries
Electrical Program
PO Box 44460
Olympia, WA 98504-4460

Contractors must complete the application, including the following steps:

5.a Administrator Form – Contractors will need to submit a Master Certificate Form with their application. This form designates the contractor’s certified administrator.

5.b Worker’s Compensation Insurance – Contractors with employees will need to purchase worker’s compensation insurance and submit proof of insurance with their application.

Step 6 – Pay Fees

Contractors must pay the following fees when submitting their license application:

How Do Telecommunications Contractors Apply for a License in Washington?

Telecommunications contractors in Washington must navigate several steps to obtain a license. Below are the general guidelines, but contractors should refer to the DOLI’s Telecommunications Contractor Page for details on the process.

License Period – The Washington Telecommunications Contractor License is valid for two years from the date of issuance and must be renewed before the expiration date

Step 1 – Obtain a UBI Number

Telecommunications contractors must obtain a valid UBI number from either the Business Licensing Service or Washington Secretary of State

Step 2 – Hire a Certified Administrator

All license applicants must have a certified telecommunications administrator listed on their application. The administrator must be a full time employee of the contractor company and cannot serve as an administrator for multiple firms. In order to become an administrator, the applicant must pass the telecommunications administrator exam. Administrators can read the full exam requirements here.

Step 3 – Purchase a Surety Bond or Obtain an Assignment of Savings

Contractors must obtain an assignment of savings or purchase and maintain a $4,000 electrical/telecommunications contractor surety bond.

Step 4 – Purchase Insurance

All telecommunications contractors must purchase liability insurance with a minimum limit of $170,000. Contractors with employees will also need to purchase worker’s compensation insurance.

Step 5 – Complete the Application

All telecommunication contractor regulatory license applications should be mailed to:

Department of Labor & Industries
Electrical Program
PO Box 44460
Olympia, WA 98504-4460

Contractors must complete the application, including the following steps:

5.a Administrator Form – Contractors will need to submit a Master Certificate Form with their application. This form designates the contractor’s certified administrator.

5.b Proof of Insurance – Contractors will need to submit proof of insurance with their application

Step 6 – Pay Fees

Contractors must pay the following fees when submitting their license application:

• • $277.60 application fee
  • $41.60 assignment of administrator fee

How Does a Washington Contractor Renew Their Registration?

Electrical and Telecommunication contractors can renew their license online here. All Washington Electrical and Telecommunications Contractor Licenses are valid for two years from the date of issuance and must be renewed before the expiration date

What Are the Insurance Requirements for Electrical and Telecommunications Contractors in Washington?

The state of Washington requires telecommunication contractors to purchase liability insurance with a minimum limit of $170,000. Both electrical and telecommunications contractors with employees must purchase worker’s compensation insurance. Contractors must either obtain an assignment of savings or purchase and maintain a $4,000 electrical/telecommunications contractor surety bond.

How Do Washington Electrical and Telecommunications Contractors File Their Bond With The Washington DOLI?

Contractors should mail the completed bond form, including the power of attorney, to the following address:

Department of Labor & Industries
Electrical Program
PO Box 44460
Olympia, WA 98504-4460

The electrical/telecommunications contractor surety bond requires signatures from both the surety company that issues the bond and the contractor. The surety company should include the following information on the bond form:

• Legal name, license number, phone number and address of the entity/individual purchasing the bond
• Buyer’s business structure (corporation, LLC etc)
• Surety company’s name, address, and phone number
• State the surety company is located in
• Date the bond goes into effect

What Can Contractors Do to Avoid Claims Against the Washington Electrical/Telecommunications Contractor Bond?

To avoid claims on the Electrical/Telecommunications Contractor Bond, contractors must follow all license regulations in the state, including some of the most important issues below that tend to cause claims:

• Do not engage in, or allow any representatives of your business to engage in, any acts of fraud
• Follow all building codes and regulations
• Pay all required taxes and fees
• Pay employees and subcontractors for work performed
• Pay all suppliers and vendors

What Other Insurance Products Can Agents Offer Electrical and Telecommunications Contractors in Washington?

Washington requires telecommunications contractors to obtain liability insurance. Additionally, contractors with employees must purchase worker’s compensation insurance. Bonds are our only business at BondExchange, so we do not issue liability insurance, but our agents often utilize brokers for this specific line of business. A list of brokers in this space can be found here.

How Can Insurance Agents Prospect for Washington Electrical and Telecommunications Contractor Customers?

Washington conveniently provides a public database to search for active contractors in the state. The database can be accessed here. Contact BondExchange for additional marketing resources. Agents can also leverage our print-mail relationships for discounted mailing services.

What other Contractor License Bonds are Required in Washington?

Contractors in Washington will need to obtain specific bonds correlating with their license type. Contractors seeking to register as a general or specialty contractor will need to purchase either $12,000 or $6,000 Contractor License Bond.