How to Get a Surety Bond in Long Beach

Surety bonds are a critical component of doing business in Long Beach, California—whether you're a contractor, auto dealer, mortgage broker, or public official. These legally binding agreements protect clients, government entities, and the public by ensuring that licensed professionals fulfill their contractual obligations. In Long Beach, where construction projects, maritime commerce, and small business activity thrive, obtaining the correct surety bond isn’t just a formality—it’s a legal requirement and a mark of credibility.

Many individuals and businesses in Long Beach misunderstand surety bonds, confusing them with insurance or assuming they’re optional. In reality, surety bonds are a three-party agreement: the principal (you), the obligee (the entity requiring the bond, such as the City of Long Beach or a state agency), and the surety (the bonding company). If you fail to meet your obligations, the surety pays valid claims up to the bond amount—and then seeks reimbursement from you.

This guide provides a comprehensive, step-by-step roadmap for obtaining a surety bond in Long Beach. Whether you’re applying for the first time or looking to renew an expiring bond, this resource will help you navigate the process confidently, avoid costly mistakes, and position your business for long-term success in one of California’s most competitive markets.

Step-by-Step Guide

Step 1: Determine the Type of Surety Bond You Need

The first and most crucial step in obtaining a surety bond in Long Beach is identifying the exact type of bond required. Different industries and licensing authorities mandate different bonds. Common categories include:

• Contractor Bonds: Required by the California Contractors State License Board (CSLB) for all licensed contractors. Includes bid bonds, performance bonds, and payment bonds.
• License and Permit Bonds: Required by the City of Long Beach or state agencies for businesses such as auto dealers, mortgage brokers, collection agencies, and alcohol retailers.
• Court Bonds: Used in legal proceedings, including appeal bonds, fiduciary bonds, and injunction bonds.
• Public Official Bonds: Required for elected or appointed officials handling public funds, such as city clerks or treasurers.
• Specialty Bonds: Includes notary bonds, janitorial service bonds, and fuel tax bonds.

To determine your bond type, consult the licensing authority that regulates your business. For example:

• Contractors: California Department of Consumer Affairs – CSLB
• Auto Dealers: California Department of Motor Vehicles (DMV)
• Mortgage Brokers: California Department of Financial Protection and Innovation (DFPI)
• City of Long Beach Permits: Long Beach Business License Division

Always verify the bond amount and language requirements. For instance, the CSLB requires a $25,000 contractor license bond, while the City of Long Beach may require a $5,000 business license bond for certain service providers.

Step 2: Verify Bond Requirements with the Obligee

Before applying, confirm the bond specifications directly with the obligee—the agency or entity requiring the bond. Requirements can vary based on:

• Business type and classification
• Project scope (for construction bonds)
• Previous compliance history
• Local ordinances (e.g., Long Beach Municipal Code Chapter 5.36 for business licenses)

Some bonds require specific wording. For example, a Long Beach business license bond must include the phrase: “The Principal hereby agrees to comply with all applicable laws, ordinances, rules, and regulations of the City of Long Beach.”

Visit the official website of the obligee or request a copy of the bond form. Never assume the bond language is standard—incorrect wording can result in rejection and delays.

Step 3: Gather Required Documentation

Once you know your bond type and requirements, collect the following documents:

• Business License or Articles of Incorporation: Proof of legal business registration with the California Secretary of State or City of Long Beach.
• Driver’s License or Government-Issued ID: For identity verification.
• Financial Statements: Especially for higher-value bonds (e.g., $100,000+). This may include balance sheets, profit/loss statements, or tax returns.
• Credit Report: Most surety companies review personal and/or business credit history. A FICO score above 650 typically qualifies for lower premiums.
• Professional Licenses: If applicable (e.g., CSLB license number for contractors).
• Project Details (for contract bonds): Contract amount, project location, scope of work, and client information.

Organize these documents digitally and in hard copy. Many bond providers now accept electronic submissions, but having physical copies on hand ensures you’re prepared for any request.

Step 4: Choose a Licensed Surety Bond Provider

Not all bonding companies are created equal. In Long Beach, you must work with a surety company licensed by the California Department of Insurance (CDI). To verify licensure:

1. Visit the CDI’s online licensee search tool at www.insurance.ca.gov.
2. Search by company name or license number.
3. Confirm the company is authorized to issue surety bonds in California.

Reputable providers in Long Beach include:

• California Surety Services
• Long Beach Bonding Group
• West Coast Surety
• SuretyBonds.com (national provider with local support)

When selecting a provider, consider:

• Experience with your industry
• Response time and customer service
• Transparency in pricing and terms
• Ability to issue bonds quickly

Avoid brokers who don’t underwrite bonds themselves or who pressure you into unnecessary add-ons. Legitimate providers will explain your premium, terms, and obligations clearly.

Step 5: Complete the Application

Most surety providers offer online applications. The process typically includes:

• Entering business and personal information
• Selecting the bond type and amount
• Uploading required documents
• Reviewing and signing the bond agreement

For higher-risk applicants or large bonds, you may be asked to complete a more detailed underwriting questionnaire covering:

• Business history and ownership structure
• Previous bond claims or defaults
• Banking relationships and cash flow
• Industry-specific experience

Be honest and thorough. Incomplete or misleading information can lead to denial or future claim disputes.

Step 6: Pay the Bond Premium

The premium is the cost of the bond, typically ranging from 1% to 10% of the total bond amount, depending on your creditworthiness and risk profile.

For example:

• Contractor bond ($25,000) with good credit: $250–$750
• Auto dealer bond ($50,000) with fair credit: $1,000–$2,500
• Business license bond ($5,000) with excellent credit: $50–$150

Applicants with credit scores below 600 may pay 5–15% of the bond amount. Some providers offer payment plans for larger bonds. Always request a written quote before paying.

Payment methods vary by provider but commonly include credit card, ACH transfer, or wire transfer. Once payment is confirmed, the surety will issue the bond.

Step 7: Receive and Review Your Bond

After payment, you’ll receive your bond document via email or postal mail. Carefully review it for accuracy:

• Principal name and business address
• Obligee name and address
• Bond amount and effective dates
• Correct bond form language
• Surety company signature and seal

If any information is incorrect, contact the provider immediately. Bonds with errors may be rejected by the obligee.

Step 8: Submit the Bond to the Obligee

Submit your bond according to the obligee’s instructions. Methods include:

• Online submission through a government portal (e.g., CSLB’s online licensing system)
• Mail with certified return receipt
• In-person delivery at city or state offices

For Long Beach business license bonds, submit to the Business License Division at 201 West 3rd Street, Long Beach, CA 90802. Always request a confirmation of receipt. Keep a copy of the submitted bond and proof of delivery for your records.

Step 9: Maintain Compliance and Renewal

Surety bonds are not one-time purchases. Most bonds must be renewed annually, though some (like contract bonds) expire with the project.

Set calendar reminders 30–60 days before expiration. Renewal typically involves:

• Reapplying with updated financial information
• Receiving a new premium quote
• Signing a new bond agreement
• Resubmitting to the obligee

Failure to renew can result in license suspension, fines, or project termination. Some obligees, like the CSLB, automatically notify you—but don’t rely on this. Proactive renewal is essential.

Best Practices

Build and Maintain Strong Credit

Your personal and business credit scores significantly impact your bond premium. Even if you’re not applying for financing, your credit history is a key underwriting factor. To improve your score:

• Pay bills on time, every time
• Reduce credit utilization below 30%
• Dispute errors on your credit report
• Avoid opening multiple new credit lines in a short period

Improving your credit score by 50 points can reduce your bond premium by up to 50%. Consider using free credit monitoring tools like Credit Karma or Experian.

Keep Accurate Business Records

Document every project, payment, client interaction, and compliance action. In the event of a claim, thorough records can help you dispute invalid allegations and protect your bond. Use cloud-based accounting software like QuickBooks or FreshBooks to maintain organized financial records.

Understand the Difference Between Insurance and Bonds

Many confuse surety bonds with liability insurance. Insurance protects you from losses; a surety bond protects the obligee. If a claim is paid out, you are legally obligated to repay the surety. Never assume your bond covers your own mistakes.

Work with a Bond Specialist

Don’t attempt to navigate complex bond requirements alone. A licensed surety professional familiar with Long Beach regulations can save you time, money, and stress. They can help you choose the right bond, avoid application errors, and negotiate better rates.

Stay Informed on Regulatory Changes

California and Long Beach frequently update licensing and bonding laws. Subscribe to newsletters from:

• California Department of Consumer Affairs
• City of Long Beach Business License Division
• California Contractors State License Board

Regular updates help you stay compliant and avoid unexpected bond requirements.

Plan for Bond Claims Proactively

While most bonds go unclaimed, disputes can arise. To minimize risk:

• Always fulfill contracts as written
• Get client sign-offs on completed work
• Document communication with clients
• Address complaints quickly and professionally

Early resolution often prevents claims from escalating.

Tools and Resources

California Department of Insurance (CDI) License Search

www.insurance.ca.gov – Verify that your bond provider is licensed and in good standing. This is non-negotiable.

California Contractors State License Board (CSLB)

www.cslb.ca.gov – Required for contractors. Use the “Check a License” tool to verify your status and bond requirements.

City of Long Beach Business License Portal

www.longbeach.gov/business – Apply for or renew your business license. Find bond forms, fees, and local ordinances.

DMV Vehicle Dealer Licensing

www.dmv.ca.gov – Auto dealers must comply with DMV bond requirements. Download bond forms and FAQs here.

Free Credit Monitoring Tools

• AnnualCreditReport.com – Free annual credit reports from Equifax, Experian, and TransUnion.
• Credit Karma – Free credit score tracking and alerts.

Document Management Tools

• Google Drive / Dropbox: Store digital copies of your bond, license, and financial documents.
• Notion or Airtable: Create custom trackers for bond expiration dates, renewal reminders, and client contracts.

Industry Associations

• Associated General Contractors of California (AGC): Offers resources and bonding guidance for contractors.
• Long Beach Chamber of Commerce: Hosts workshops on compliance and licensing.
• California Mortgage Bankers Association: Supports mortgage professionals with bonding and regulatory updates.

Legal and Compliance Guides

• California Business and Professions Code – Title 11, Division 3 (Contractors)
• Long Beach Municipal Code – Chapter 5.36 (Business License and Tax)
• California Code of Regulations – Title 10, Chapter 1 (DMV Dealer Regulations)

These documents are available for free on official government websites. Bookmark them for quick reference.

Real Examples

Example 1: Residential Contractor in Long Beach

John, a licensed general contractor in Long Beach, needed to renew his $25,000 CSLB bond. His credit score was 720, and he had no prior claims. He applied through a local surety provider, submitted his CSLB license number, and paid a $300 premium. The bond was issued within 24 hours and submitted electronically via CSLB’s online portal. His license remained active without interruption.

Example 2: Used Car Dealer Applying for the First Time

Maya opened a used car dealership in Long Beach. The DMV required a $50,000 auto dealer bond. Her credit score was 580, so her initial quote was $3,500. She worked with a bond specialist who helped her submit a detailed business plan and three months of bank statements. After underwriting review, her premium was reduced to $2,200. She submitted the bond to the DMV and opened her lot within two weeks.

Example 3: Small Business Owner with a City of Long Beach License

David operated a cleaning service and needed a $5,000 business license bond. He mistakenly submitted a bond form with outdated city wording. His application was rejected, delaying his license by three weeks. After consulting the Long Beach Business License Division’s website, he obtained the correct form, resubmitted, and was approved. He now keeps a digital folder of all bond requirements for future renewals.

Example 4: Construction Firm Bidding on a Public Project

A Long Beach-based firm bid on a city-funded sidewalk project. The RFP required a bid bond (10% of the bid amount) and a performance/payment bond (100% of contract value). The firm used a surety provider experienced in public works. They submitted detailed financials and project history. The surety approved a $200,000 performance bond at a 1.5% premium ($3,000). The firm won the contract and completed it without claims.

FAQs

How long does it take to get a surety bond in Long Beach?

For applicants with good credit and complete documentation, most bonds are issued within 1–3 business days. Complex bonds or those requiring underwriting review may take up to 10 business days. Expedited service is often available for an additional fee.

Can I get a surety bond with bad credit?

Yes. Many surety providers offer programs for applicants with poor credit. Premiums will be higher—typically 5–15% of the bond amount—but approval is still possible. Improving your credit over time can lead to lower premiums upon renewal.

Do I need a bond if I’m a sole proprietor?

Yes. Whether you’re a sole proprietor, LLC, or corporation, if the obligee requires a bond, you must obtain one. The bond is tied to your business entity, not your legal structure.

What happens if someone files a claim against my bond?

If a valid claim is filed, the surety will investigate. If the claim is upheld, the surety pays the obligee up to the bond amount. You are then legally obligated to repay the surety in full, plus any legal fees. Failure to repay can result in collections, legal action, or denial of future bonds.

Can I cancel my surety bond early?

You cannot cancel a bond unilaterally. The bond remains active until its expiration date or until the obligee releases you in writing. Some bonds are non-cancelable for the full term. Always confirm cancellation terms with your provider and the obligee.

Is my bond valid statewide or only in Long Beach?

Most bonds issued in California are valid statewide. However, some city-specific bonds (like Long Beach business license bonds) only apply within that jurisdiction. Always check the bond’s geographic scope.

Do I need a separate bond for each city I work in?

If another city requires a bond for the same type of business, yes. For example, if you’re a contractor working in both Long Beach and Los Angeles, you may need separate bonds if each city has unique requirements.

Can I use the same bond for multiple licenses?

No. Each license type (e.g., contractor, auto dealer, mortgage broker) requires its own bond. Even if the bond amount is the same, the obligee and bond language must match the specific license.

What if my bond expires before I renew it?

Your license or permit may be suspended immediately. You could face fines, loss of contracts, or legal penalties. Always renew at least 30 days before expiration.

How do I know if my bond was accepted?

Request a confirmation email or letter from the obligee. For state agencies like CSLB or DMV, log into your online account to verify bond status. For the City of Long Beach, call the Business License Division at (562) 570-2500 to confirm receipt.

Conclusion

Obtaining a surety bond in Long Beach is not a bureaucratic hurdle—it’s a strategic investment in your business’s credibility, compliance, and longevity. Whether you’re a new contractor entering the market or a seasoned business owner renewing your license, understanding the process, choosing the right provider, and maintaining compliance are essential to thriving in one of California’s most dynamic economic hubs.

By following the steps outlined in this guide—from verifying your bond type to renewing on time—you eliminate guesswork and reduce risk. Use the tools and resources provided to stay informed, and always prioritize accuracy over speed. A properly secured surety bond builds trust with clients, protects your reputation, and ensures you’re ready to seize opportunities as they arise.

Remember: A surety bond isn’t just a requirement—it’s a promise. Keep that promise, and your business will stand out in Long Beach’s competitive landscape.