Who requires it
Tennessee Board for Licensing Contractors
License & permit · Tennessee
Tennessee Contractor’s License Indemnity Bond
The Board’s ContBLC Contractor’s License Bond is a fixed-amount indemnity some contractors use instead of a Guaranty Agreement when supporting a monetary limit. Amounts the Board will consider are typically $500,000 or $1,000,000. It does not replace the CPA financial statement and is not the July 2026 Contractors’ Surety Bond that can stand in for financials.
Common bond amount
$500,000 / $1,000,000
ContBLC: $500,000 if less than $3,000,000; $1,000,000 if more than $3,000,000. At exactly $3,000,000, confirm the amount with the Board—not the Pub. Ch. 1039 ≥50%-of-limit Contractors’ Surety Bond.
How you file
File the ContBLC bond form instead of a Guaranty Agreement
Renewal
Align with the two-year license; replace the indemnity when still required
Who requires it
Applicants and renewing contractors when Board financial review calls for an indemnity and a Guaranty Agreement is not workable—for example cash-only financial statements with little plant and equipment, subsidiaries needing parent support, or applicants who choose this bond instead of a personal or corporate guaranty. Contractors using the Pub. Ch. 1039 Contractors’ Surety Bond instead of a financial statement follow that separate guide instead.
How much is required
Board ContBLC indemnity materials state the Board will consider a Contractor’s License Bond of $500,000 when the monetary limit is less than $3,000,000, or $1,000,000 when the limit is more than $3,000,000. ContBLC materials do not expressly assign a bond amount when the monetary limit is exactly $3,000,000—confirm the required amount with the Tennessee Board for Licensing Contractors. The bond may be used only instead of a Guaranty Agreement and does not replace the required CPA-prepared financial statement. Rule 0680-01-.13 otherwise sets the monetary limit from ten times the lesser of net worth and working capital when you remain on the financial-statement path.
How to get and file it
Confirm with Board staff that a ContBLC Contractor’s License Bond is the indemnity path for your file. Use the Board’s exact ContBLC bond form—no rewritten language—executed by a Tennessee-authorized surety with an A.M. Best rating the Board accepts, attach power of attorney, and keep the original for filing with your license or renewal package. Match the legal name on the CPA financial statement that supports the license. Submit the original bond with the application or renewal when Board review requires that indemnity. Licenses typically renew on a two-year cycle; if the indemnity is still needed at renewal, provide a current bond or another accepted indemnity. Board materials hold the bond from release for one year after license expiration or replacement of the indemnity. Bid, performance, and payment bonds for individual jobs are separate instruments outside this guide.
Cost note
$500,000 or $1,000,000 is the required bond amount if the Board accepts that indemnity path, not the premium you pay. See bond amount vs premium. Bond amount vs premium →
Requirement checklist
- When used
- Instead of a Guaranty Agreement for Board-identified indemnity situations—not a substitute for the CPA financial statement
- Common amounts
- $500,000 for monetary limits less than $3,000,000; $1,000,000 for limits more than $3,000,000; at exactly $3,000,000, confirm with the Board (ContBLC materials)
- Form rules
- Exact ContBLC bond language, power of attorney, A.M. Best–rated surety as Board policy requires
- Release
- Not released for one year after license expiration or indemnity replacement
Official sources
Frequently asked questions
Does every Tennessee contractor need this $500,000 / $1,000,000 bond?
No. Many applicants use CPA financial statements alone, a line of credit, a Guaranty Agreement, or—since July 1, 2026—the Contractors’ Surety Bond instead of a financial statement. This ContBLC bond is only for identified indemnity situations.
Can this ContBLC bond replace my financial statement?
No. ContBLC materials state it may be used only instead of the Guaranty Agreement and does not waive the CPA financial statement. To replace financials, use the separate Contractors’ Surety Bond path under § 62-6-111.
How is this different from the Contractors’ Surety Bond?
The Contractors’ Surety Bond (Pub. Ch. 1039) scales to at least 50% of your monetary limit and can replace the financial statement. This ContBLC Contractor’s License Bond uses fixed $500,000 / $1,000,000 amounts and only substitutes for a Guaranty Agreement.
Related Tennessee bond guides
Contractors’ Surety Bond
≥ 50% of monetary limit
Since July 1, 2026, Tennessee contractor applicants and licensees may file a Board-approved Contractors’ Surety Bond instead of a CPA financial statement. The amount must be at least half the monetary limit you request, stay in force while you rely on it, and keep the license valid only while the bond remains in force.
Home Improvement Contractor Bond
$10,000
In counties that adopted Tennessee’s home improvement law, remodelers working between $3,000 and $24,999 must show $10,000 of financial responsibility to the Board for Licensing Contractors. A surety bond is the usual path; cash, property, or an irrevocable letter of credit can also satisfy the rule.
Surety basics (not repeated here)
Universal surety concepts explained once—linked here instead of repeated on every state or bond page.
Continue with a Tennessee application
Tennessee will be preselected. Choose your bond type in the application—we confirm the correct product against your agency form before anything is issued.
Last verified 2026-08-10. This guide is based on verified educational content and official sources.
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