Who requires it
Tennessee Board for Licensing Contractors — Home Improvement
License & permit · Tennessee
Tennessee Home Improvement Contractor Bond
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.
Common bond amount
$10,000
Fixed surety amount in Rule 0680-07-.13; cash, property, or irrevocable letter of credit may replace the surety bond. Applies only in adopting counties.
How you file
Surety bond, or cash / property / letter of credit, filed with the Board
Renewal
Two-year license; keep financial-responsibility proof on file; one-year hold after the license ends
Who requires it
Home improvement contractors licensed under T.C.A. title 62, chapter 6, part 5 when they work in an adopting county on residential remodeling, repair, replacement, alteration, or addition jobs from $3,000 to $24,999. Board materials currently list Bradley, Davidson, Hamilton, Haywood, Knox, Marion, Robertson, Rutherford, and Shelby. Licensed residential or commercial contractors on projects at or above $25,000 follow the broader contractor license track instead of this home improvement credential. Electrical, HVAC, and plumbing scopes are outside this home improvement license.
How much is required
Rule 0680-07-.13 establishes a fixed $10,000 surety bond for the benefit of claimants damaged by breach of a home improvement contract. The same rule accepts a $10,000 irrevocable letter of credit from an FDIC-insured institution. Board pages also list cash and property bonds as alternate proofs. The amount does not scale with job size inside the $3,000–$24,999 band.
How to get and file it
Order a Board-approved home improvement surety bond in the exact legal name and mode of operation on your CORE application, with power of attorney attached, or arrange cash, property, or letter-of-credit proof the Board will accept. Apply online through CORE with the current $250 initial fee, photo ID, liability and workers’ compensation certificates, and entity registration when you operate as a corporation, partnership, or LLC. File the bond or alternate proof with the home improvement application and keep it active while licensed. If the surety bond ends, Rule 0680-07-.13 treats the license as invalid. Bonds and letters of credit are not released for one year after inactivation, expiration, revocation, or replacement, and pending claims can extend that hold. Licenses run two years; renew through CORE with current financial-responsibility proof.
Cost note
$10,000 is the required bond amount, not the premium you pay. See bond amount vs premium. Bond amount vs premium →
Requirement checklist
- Required amount
- $10,000 surety, cash bond, property bond, or irrevocable letter of credit
- Project band
- Residential remodeling and related improvements from $3,000 to $24,999 in adopting counties
- Related insurance
- General liability and workers’ compensation as required on Board home improvement materials
- Release timing
- Bond or letter of credit held at least one year after license inactivation, expiration, or revocation (longer if claims remain)
Official sources
Related resources
Frequently asked questions
Does every Tennessee county require a home improvement license bond?
No. The home improvement license—and its $10,000 financial-responsibility proof—applies only in counties that adopted the law. Confirm the current adopting-county list on the Board’s home improvement page before you order a bond.
Can I use a letter of credit instead of a surety bond?
Yes. Rule 0680-07-.13 accepts a $10,000 irrevocable letter of credit from an FDIC-insured institution. Board materials also list cash and property bonds as alternatives.
Is this the same as a Tennessee contractor surety bond?
No. Home improvement financial responsibility is a fixed $10,000 bond for part 5 licenses. Broader contractor licenses use either the Contractors’ Surety Bond (≥50% of monetary limit instead of a financial statement) or, in limited ContBLC indemnity situations, a separate $500,000 / $1,000,000 Contractor’s License Bond.
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.
Contractor’s License Indemnity Bond
$500,000 / $1,000,000
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.
Motor Vehicle Dealer Bond
$50,000
Tennessee motor vehicle dealers must keep a surety bond of at least $50,000 on file with the Motor Vehicle Commission while licensed. Form IN-1316 is the Commission’s Motor Vehicle Dealer Bond; statute rejects a letter of credit as a substitute for that bond.
Surety basics (not repeated here)
Universal surety concepts explained once—linked here instead of repeated on every state or bond page.
Apply for the Home Improvement Contractor Bond
The application can open with this bond already selected. You can still go back and change selections.
Last verified 2026-08-10. This guide is based on verified educational content and official sources.
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