Illinois Roofing Contractor Bond: A Comprehensive Guide For Insurance Agents

February 9, 2021

This guide provides information for insurance agents to help contractors on Illinois Roofing Contractor bonds

At a Glance:

• Average Cost: 
  • $100 per year for limited license applicants
  • $250 per year for unlimited license applicants
• Bond Amount:
  • $10,000 for limited license holders
  • $25,000 for unlimited license holders
• Who Needs It: All individuals and business entities seeking to obtain a Roofing Contractor License in the State of Illinois
• Purpose: To ensure the public will receive compensation for any damages should the contractor fail to comply with contractor licensing law
• Who Regulates Roofing Contractors in Illinois: The Illinois Department of Financial and Professional Regulation (IDFPR)

Background

Illinois Compiled Statutes 225 ILCS 335/3.2 requires roofing contractors operating in the state to obtain a license with the IDFPR. The Illinois legislature enacted 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 post a cash deposit or purchase and maintain either a $10,000 or $25,000 Roofing contractor surety bond to be eligible for licensure.

What is the Purpose of the Illinois Roofing Contractor Bond?

Illinois requires roofing contractors to purchase the Roofing Contractor Bond as part of the application process to obtain a Roofing 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 roofing contractor breaks licensing laws.

How Can an Insurance Agent Obtain an Illinois Roofing Contractor Surety Bond?

BondExchange makes obtaining an Illinois Roofing 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 Illinois Roofing Contractor Bond?

No, a credit check is not required for the Illinois Roofing Contractor Bond. Because this bond is considered relatively low-risk, the same low rate is offered to all contractors in Illinois.

How Much Does the Illinois Roofing Contractor Bond Cost?

The Illinois Roofing Contractor Bond will cost the following amount:

• $10,000 Bond Limit: $100 per year
• $25,000 Bond Limit: $250 per year

What is the Difference Between an Illinois Limited and Unlimited Roofing Contractor License?

To paraphrase Illinois Code 225 ILCS 335/2(H)(I), a limited roofing license allows contractors to perform work on residential properties consisting of 8 units or less, and an unlimited roofing license allows contractors to perform roofing related contract work without limitations.

How Do Roofing Contractors Apply for a License in Illinois

Contractors in Illinois must navigate several steps to secure their roofing contractors license. Below are the general guidelines, but contractors should refer to the application form for details on the process.

License Period – The Illinois Roofing Contractors License expires on June 30 of every odd numbered year (2021, 2023, etc) and must be renewed before the expiration date.

Step 1 – Determine the License Type

Illinois requires roofing contractors to obtain a specific license corresponding to the nature in which the contractor’s business operates. Below are the different types of the Illinois Roofing Contractors License.

• • Limited Roofing License – Limited to working on residential properties consisting of 8 units or less
  • Unlimited Roofing License – Can perform work on all residential, commercial, and industrial properties.

Step 2 – Purchase Insurance

All roofing contractors must purchase and maintain general liability insurance with the following minimum limits:

• • $250,000 for property damage
  • $500,000 for physical injury

Additionally, contractors with employees will also need to purchase workers’ compensation insurance.

Step 3 – Purchase a Surety Bond or Deposit Cash

Roofing contractors must deposit cash or purchase and maintain a roofing contractor surety bond in the following amounts:

• • $10,000 for limited license applicants
  • $25,000 for unlimited license applicants

Step 4 – Obtain a Business License

All businesses operating in the State of Illinois must obtain a business license with the IDFPR. Contractors can obtain a business license here.

Step 5 – Pass the Examination

Roofing contractors must employ a qualified individual who is capable of managing the day to day operations of the contractor business. Qualified individuals must pass a licensure examination authorized by the IDFPR in order to obtain a license. All qualified individuals must complete an exam application and submit their completed application here.

Step 6 – Complete the Application

All regulatory roofing contractors license applications and fees should be mailed to:

Illinois Department of Financial and Professional Regulation
Division of Professional Regulation
P.O. Box 7007
Springfield, Illinois 62791

Contractors must pay a $125 fee when submitting their license application

How Does an Illinois Roofing Contractor Renew Their License?

Roofing contractors can renew their license online through the IDFPR’s licensing portal. The Illinois Roofing Contractors License expires 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 Illinois Roofing Contractors License?

The State of Illinois requires Roofing contractors to obtain public liability insurance with minimum limits of 250/500. Contractors who have employees will also need to obtain worker’s compensation insurance. Contractors must deposit cash or purchase either a $10,000 or $25,000 roofing contractor surety bond.

How Do Illinois Roofing Contractors File Their Bond With The Illinois IDFPR?

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

Illinois Department of Financial and Professional Regulation
Division of Professional Regulation
P.O. Box 7007
Springfield, Illinois 62791

The roofing 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 type, address and phone number of the entity/individual(s) buying the bond
• Surety company’s name, address, and phone number
• Date the bond is signed and goes into effect

What Can Contractors Do to Avoid Claims Against the Illinois Roofing Contractor Bond?

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

• Pay all laborers and employees
• Pay all taxes and contributions due to state and local municipalities on time and in full
• Pay suppliers for all materials and equipment
• Abide by contracts and repair improper or negligent work

What Other Insurance Products Can Agents Offer Roofing Contractors in Illinois?

Illinois requires roofing contractors to obtain general liability insurance. In addition, contractors with employees will have to purchase workers’ compensation insurance. Bonds are our only business at BondExchange, so we do not issue liability or workers’ compensation 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 Illinois Roofing Contractor Customers?

Illinois conveniently provides a public database to search for active roofing 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.