Virginia Contractor's License Bond

Overview

Virginia gives contractors a choice most states don't: under Code of Virginia § 54.1-1120, a licensed contractor may post a $50,000 surety bond with the Board for Contractors instead of participating in the Virginia Contractor Transaction Recovery Fund. The bond is filed on DPOR's official Surety Bond Form (A501-27BOND) and runs for a two-year term matching the license cycle. Contractors who elect the bond option are exempt from Recovery Fund assessments, and consumers harmed by the contractor's improper or dishonest conduct claim against the bond rather than the Fund.

Who Needs This Bond?

This bond is for contractors licensed — or applying for licensure — through the Virginia Department of Professional and Occupational Regulation's Board for Contractors who choose the bonding alternative authorized by § 54.1-1120. Class A, Class B, and Class C applicants in any classification can elect it. Firms that prefer a surety relationship over paying Recovery Fund assessments, and firms directed by the Board to post a bond, file DPOR Form A501-27BOND executed by a surety authorized to do business in Virginia.

What is this Bond For?

Under § 54.1-1120(A), the bond stands in the place of the Transaction Recovery Fund for that contractor: a person who suffers a loss caused by the contractor's improper or dishonest conduct in a transaction that would otherwise qualify for a Fund claim recovers against the bond instead. Code of Virginia § 54.1-1120.1 caps what a claimant may recover, in line with the per-claim limits that apply to Fund claims — the full $50,000 penal sum is the bond's aggregate ceiling, not what each claimant automatically receives. The bond protects consumers; it is not insurance for the contractor, who must reimburse the surety for paid claims.

When is it Required?

The election happens at licensure: a new applicant who chooses the bond option files the executed A501-27BOND form with the license application, and the bond must remain in force for the full two-year license term. At each renewal, the contractor either files a new bond for the next term or reverts to Recovery Fund participation. If the bond is cancelled mid-term and not replaced, the exemption from Fund assessments ends and the license falls out of compliance — so treat the bond's expiration date as a licensing deadline.

Where Does it Apply?

The bond covers work performed under the Virginia contractor license anywhere in the Commonwealth — all counties, cities, and towns — because the requirement comes from Title 54.1 of the Code of Virginia, not from local ordinances. It is filed with DPOR's Board for Contractors in Richmond on the Board's prescribed form. Local jurisdictions may impose separate permit bonds for specific projects; those are distinct obligations and do not replace this statewide licensing bond.

How to Buy Online

Click 'Buy This Bond Online' and the secure surety portal opens in a new tab. Complete the short application, review your bond documents, and pay in one sitting. Your executed Virginia contractor bond is ready to file with DPOR alongside your license application or renewal as soon as you finish.

Why Bond Titan?

Bond Titan is powered by The Southern Agency, a licensed surety agency, and every requirement stated on this page is cited to the Code of Virginia and DPOR's official bond form in the Official Sources section below. Verify the rules yourself, then get your executed bond fast enough to keep your Board for Contractors timeline intact.

Official Sources

The requirements described on this page are verified against the official sources below.

• $50,000 surety bond may be posted in lieu of Recovery Fund participation; bond covers losses from improper or dishonest conduct; exemption from Fund assessments: Code of Virginia § 54.1-1120 (verified July 16, 2026)
• Limits on recovery against the bond, consistent with Recovery Fund per-claim caps: Code of Virginia § 54.1-1120.1 (verified July 16, 2026)
• Official DPOR Board for Contractors surety bond form; two-year bond term matching the license cycle: Virginia DPOR Form A501-27BOND (verified July 16, 2026)