South Carolina Registered Residential Specialty Contractor Bond: A Comprehensive Guide

January 6th, 2021

This guide provides information for insurance agents to help contractors on South Carolina Registered Residential Specialty Contractor bonds

*This page focuses solely on the bond requirements for registered residential specialty contractors. Insurance agents can learn about the bond requirements for licensed residential specialty contractors here

At a Glance:

• Average Cost: $100 per year
• Bond Amount: $5,000
• Who Needs It: All registered residential specialty contractors operating in South Carolina
• Purpose: To ensure the public will receive compensation for any damages should the contractor fail to comply with registration law
• Who Regulates Residential Specialty Contractors in South Carolina: The South Carolina Residential Builders Commission (RBC)

Background

South Carolina Code of Laws 40-59-30 requires residential specialty contractors operating in the state to obtain either a license or registration with the RBC. The South Carolina legislature enacted registration laws and regulations to ensure that contractors engage in ethical business practices. In order to provide financial security for the enforcement of the registration law, contractors must purchase and maintain a $5,000 registered residential specialty contractor surety bond to be eligible for registration.

What is the Purpose of the South Carolina Registered Residential Specialty Contractor Bond?

South Carolina requires contractors to purchase the Registered Residential Specialty Contractor Bond as part of the application process for the Residential Specialty Contractor Registration. The bond ensures that the public will receive compensation for financial harm if the contractor fails to comply with the registration regulations. In short, the bond is a type of insurance that protects the public if the contractor breaks registration laws.

How Can an Insurance Agent Obtain a South Carolina Registered Residential Specialty Contractor Surety Bond?

BondExchange makes obtaining a South Carolina Registered Residential Specialty 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 South Carolina Registered Residential Specialty Contractor Bond?

Some surety companies may run a credit check on the owners of the contractor company prior to issuing the South Carolina Registered Residential Specialty Contractor bond. The credit check is a “soft hit”, meaning that the credit check will not affect the contractor’s credit.

How Much Does the South Carolina Registered Residential Specialty Contractor Bond Cost?

The South Carolina Registered Residential Specialty Contractor surety bond costs just $100 per year.

How Does South Carolina Define “Residential Specialty Contractor”?

To paraphrase South Carolina Code of Laws 40-59-20, a residential specialty contractor is any individual or business entity who performs contract work requiring special skills such as plumbing, HVAC, or electrical services.

How Do Residential Specialty Contractors Apply for a Registration in South Carolina?

Contractors in South Carolina must navigate several steps to secure their residential specialty contractor registration. Below are the general guidelines, but contractors should refer to the RBC’s application form for details on the process.

License Period – All South Carolina Residential Specialty Contractor Registrations expire on June 30 of every odd numbered year (2021, 2023 etc) and must be renewed before the expiration date

Step 1 – Determine the Classifications

South Carolina requires registered residential specialty contractors to classify their registration in accordance with the work the contractor performs. Contractors may select up to three classifications on their registration. Before are the classifications for the South Carolina Residential Specialty Contractor Registration:

• • Vinyl/Aluminum Siding
  • Floor Covering
  • Carpenter
  • Insulation Installer
  • Masonry
  • Stucco Installer
  • Roofing
  • Drywall Installer
  • Painter/Wallpaper
  • Solar Panel Installer

Step 2 – Obtain References

All contractors applying for registration must obtain references from three individuals (other than family members) and submit letters of reference with their registration application. The letters of reference are subject to the following criteria:

• • Demonstrate the applicant’s character, skills, and knowledge
  • Contain in depth descriptions of the applicant’s related work experience

The letters of reference should not be generic in nature, but rather detailed accounts of the applicant’s qualifications. Generic letters will be rejected.

Step 3 – Complete the Application

Contractors can complete their application online here

Step 4 – Pay the Application Fee

When submitting their registration application, contractors will need to pay an application fee in the following amount:

• • $100 if the registration is issued between July 1 of an odd-numbered year to June 30 of an even-numbered year
  • $50 if the registration is issued between July 1 of an even-numbered year to June 30 of an odd-numbered year

Step 5 – Purchase a Surety Bond

Residential specialty contractors who performs jobs with a total project cost of $5,000 or more will need to purchase and maintain a $5,000 registered residential specialty contractor surety bond

How Do South Carolina Residential Specialty Contractors Renew Their Registration?

Residential specialty contractors can renew their registration online here. All South Carolina Residential Specialty Contractor Registrations expire on June 30 of every odd numbered year (2021, 2023 etc) and must be renewed before the expiration date

What Are the Insurance Requirements for the South Carolina Residential Specialty Contractor Registration?

The State of South Carolina does not require residential specialty contractors to obtain any form of liability insurance. Contractors who work on projects costing $5,000 or more will need to purchase and maintain a $5,000 registered residential specialty contractor surety bond.

How Do South Carolina Residential Specialty Contractors File Their Bond With The RBC?

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

South Carolina Department of Labor, Licensing and Regulation
Residential Builders Commission
PO Box 11329
Columbia, South Carolina 29211

The registered residential specialty 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 of entity/individual(s) buying the bond
• Surety company’s name
• Bond amount
• Contractor’s license term
• Date the bond is signed and goes into effect

What Can Contractors Do to Avoid Claims Against the South Carolina Registered Residential Specialty Contractor Bond?

To avoid claims on the Registered Residential Specialty 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 be negligent when performing contract work
• Do not abandon a job without a proper reason
• Do not engage in any acts of fraud
• Do not falsely advertise or misrepresent your abilities
• Do not engage in contract work outside the scope of your registration

What Other Insurance Products Can Agents Offer Residential Specialty Contractors in South Carolina?

South Carolina does not require residential specialty contractors to obtain any form of liability insurance. However, most contractors will seek to obtain this insurance anyway. 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 South Carolina Registered Residential Specialty Contractor Customers?

South Carolina conveniently provides a public database to search for active registered residential specialty 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 South Carolina?

Contractors in South Carolina will need to obtain specific bonds correlating with their license type. Below are all the different contractor licensing bonds required by South Carolina:

• General and Mechanical Contractor License – Bond limit varies
• Licensed Residential Specialty Contractor – $10,000 bond limit
• Residential Builder / Certificate of Authority – $15,000 bond limit