Minnesota Pipe Laying Contractor Bond: A Comprehensive Guide

February 15, 2021

This guide provides information for insurance agents to help contractors on Minnesota Pipe Laying Contractor Bonds

At a Glance:

• Average Cost: $250 per year
• Bond Amount: $25,000
• Who Needs It: All individuals and business entities seeking to obtain a Pipe Laying Contractor registration in the State of Minnesota
• Purpose: To ensure the public will receive compensation for any damages should the contractor fail to comply with contractor registration law
• Who Regulates Pipe Laying Contractors in Minnesota: The Minnesota Department of Labor and Industry (MDLI)

Background

Minnesota Administrative Rule 326B.46 subd2 requires pipe laying contractors operating in the state to register with the MDLI. The Minnesota 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, pipe laying contractors in Minnesota must purchase and maintain a $25,000 Pipe Laying Contractor Surety Bond to be eligible for registration.

What is the Purpose of the Minnesota Pipe Laying Contractor Bond?

Minnesota requires contractors to purchase the Pipe Laying Contractor Bond as part of the application process to obtain a Pipe Laying Contractor Registration . The bond ensures that the public will receive compensation for financial harm if the contractor fails to comply with 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 Minnesota Pipe Laying Contractor Surety Bond?

BondExchange makes obtaining a Minnesota Pipe Laying 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 Minnesota Pipe Laying Contractor Surety Bond?

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

How Much Does the Minnesota Pipe Laying Contractor Surety Bond Cost?

The $25,000 Minnesota Pipe Laying Contractor surety bond costs just $250 per year

How Does Minnesota Define “Pipe Laying Contractor”?

The DLI defines pipe laying contractor as any independent business “who contracts to perform or offer to perform building sewer and water service installation work in all areas of the state; and does not perform any other plumbing work that requires a plumbing license.”

How do Pipe Laying Contractors Apply for Registration in Minnesota?

Contractors in Minnesota must navigate several steps to secure their Pipe Laying Contractor Registration. Below are the general guidelines, but contractors should refer to the application form for details on the process.

Registration Period – The Minnesota Pipe Laying Contractor Registration expires on January 1 of even numbered years (2022, 2024 etc) and must be renewed before the expiration date

Step 1 – Start a Business

Contractors must create a business entity and register with the Minnesota Secretary of State prior to submitting their registration application

Step 2 – Purchase Insurance

Pipe laying contractors must purchase liability insurance with the following minimum limits:

• • $50,000 per person
  • $100,000 per occurrence
  • $10,000 for property damage

Contractors with employees must also purchase workers’ compensation insurance

Step 3 – Purchase a Surety Bond

Contractors must purchase and maintain a $25,000 pipe laying contractor surety bond

Step 4 – Complete the Application

All new contractor regulatory registration applications and contractor regulatory registration renewal applications should be mailed to the following address:

Minnesota Department of Labor and Industry
CCLD — Licensing
443 Lafayette Road N.
St. Paul, MN 55155

Contractors must pay a $108 registration fee when submitting their application.

How Does a Minnesota Pipe Laying Contractor Renew Their Registration?

Pipe laying contractors can mail their renewal application, including the $108 renewal fee, to the following address:

Minnesota Department of Labor and Industry
CCLD — Licensing
443 Lafayette Road N.
St. Paul, MN 55155

The Minnesota Pipe Laying Contractor Registration expires on January 1 of even numbered years (2022, 2024 etc) and must be renewed before the expiration date

What Are the Insurance Requirements for the Minnesota Pipe Laying Contractor License?

The State of Minnesota requires pipe laying contractors to obtain liability insurance with the following minimum limits:

• $50,000 per person
• $100,000 per occurrence
• $10,000 for property damage

Contractors with employees must also obtain workers’ compensation insurance. All pipe laying contractors must purchase and maintain a $25,000 Pipe Laying Contractor Bond.

How Do Minnesota Pipe Laying Contractors File Their Bond?

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

The Pipe Laying Contractor surety bond requires signatures from both the surety company and the contractor. The surety company should include the following information on the bond form:

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

What Can Contractors Do to Avoid Claims Against the Minnesota Pipe Laying Contractor Bond?

To avoid claims on the Pipe Laying 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 any acts of fraud
• Honor all contractual agreements
• Follow all building code regulations

What Other Insurance Products Can Agents Offer Pipe Laying Contractors in Minnesota?

Minnesota requires pipe laying contractors to obtain liability insurance. Contractors with employees will also need to purchase workers’ compensation insurance. Bonds are our only business at BondExchange, so we do not issue any form of 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 Minnesota Pipe Laying Contractor Customers?

Minnesota conveniently provides a public database to search for active pipe laying 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.