New State of New Jersey Home Improvement and Home Elevation Contractor Compliance Bond

According to the New Jersey Division of Consumer Affairs, in January 2024, New Jersey Governor, Phil Murphy, signed into law P.L. 2023, c. 237, which amended the Contractors’ Business Registration Act (“CBRA”), created the Home Improvement and Home Elevation Contractor Licensing Act, and established the New Jersey State Board of Home Improvement and Home Elevation Contractors.   Due to the changes to the CBRA, Home Improvement Contractor Businesses and Home Elevation Contractor Businesses (HICBs/HECBs) are required to maintain additional security to obtain, renew or reinstate their registration. While there are additional requirements that came with the changes to the CBRA, we will only discuss the new compliance bond requirement. If further information is needed regarding the additional requirements for HICBs and HECBs, please check with the New Jersey Department of Consumer Affairs.   The new security requirement, according to the New Jersey Division of Consumer Affairs, requires all HICBs and HECBs to maintain additional security which can be in the form of a compliance bond, irrevocable letter of credit, or security, money or other security. The required amount of additional security is calculated based on the value of contracts entered into by the HICB or HECB. The additional security is required to be maintained at a minimum principal sum of: 1.     $50,000 – a.     for contracts over $120,000 b.    or annual contracts totaling $750,000 or more 2.     $25,000 – a.     for contracts between $10,000 and $120,000 b.    or annual contracts totaling $150,000–$750,000 3.     $10,000 – a.     for contracts under $10,000 b.    or annual contracts totaling less than $150,000   Each HICB or HECB will be required to show proof of their additional security to ensure they are in compliance with this new law at the time of renewal. These bonds will match the license term, which runs from April 1st to March 31st every year.   Goldleaf does have good surety markets that will write the State of New Jersey Home Improvement and Home Elevation Contractor bond. All we will need is an application completed, and our team can get started on our marketing efforts. Premium is starting at 1% for these bonds. If you have any questions or want to talk to a member of our team about this new bond requirement, please give us a call at 320.269.3144 or email [email protected]