Nevada Contractor Bond and Insurance Requirements

Two separate things are required of a Nevada contractor, and neither of them is general liability insurance. One is a surety bond, in an amount the Board fixes per applicant. The other is proof of industrial insurance — workers’ compensation — covering the applicant’s employees, with a narrow affidavit route for an applicant who genuinely has none.

The bond, or a cash deposit

NRS 624.270(1) requires, before a license issues, that the applicant either:

File with the Board a surety bond in a form acceptable to the Board executed by the contractor as principal with a corporation authorized to transact surety business in the State of Nevada as surety; or (b) In lieu of such a bond, establish with the Board a cash deposit as provided in this section.

The amount is not a published figure. NRS 624.270(4):

Except as otherwise provided in subsection 6, the amount of each bond or cash deposit required by this section must be fixed by the Board with reference to the contractor’s financial and professional responsibility and the magnitude of the contractor’s operations, but must be not less than $1,000 or more than $500,000.

The range is wide and the figure is per applicant, drawn from the same kind of considerations as the monetary limit. No one can tell you the amount in advance, which is why why the bond is not a Board fee keeps it out of any fee total: the Board sets the amount, and a surety prices the premium on it.

Subsection 6, which that opening clause points at, is not a footnote. On notification that three substantiated wage claims have been filed against a contractor within a two-year period, NRS 624.270(6) says the Board “shall require the contractor to file a bond or establish a cash deposit in an amount fixed by the Board”, to be maintained “for the period required by the Board”. That provision states no ceiling, so the $500,000 figure above is the outer bound of the ordinary case and not of every case.

There is also a way out of the bond, and it is discretionary rather than automatic. Under NRS 624.270(5), after a licensee “has acted in the capacity of a licensed contractor in the State of Nevada for not less than 5 consecutive years” the Board “may relieve” them of the requirement “if evidence supporting such relief is presented to the Board” — and may require a new bond at any time afterwards. Five years does not end the bond; it makes relief something you can apply for.

Letting it lapse is not a paperwork matter. NRS 624.270(3):

Failure of an applicant or licensee to file or maintain in full force the required bond or to establish the required cash deposit constitutes cause for the Board to deny, revoke, suspend or refuse to renew a license.

Industrial insurance

NRS 624.256(1) requires, before an original or renewal license is granted, proof of “industrial insurance and insurance for occupational diseases which covers the applicant’s employees” — or one of three alternatives: a self-insured certificate from the Commissioner of Insurance, a certificate issued to an association of self-insured employers, or an affidavit.

The affidavit route is narrow and its conditions are cumulative. It affirms that the applicant has no employees, and is not and does not intend to be a subcontractor for a principal contractor, and has not and does not intend to submit a bid on a job for a principal contractor or subcontractor. All three have to hold together. It is not a “sole proprietors are exempt” rule, and reading it as one is how a contractor ends up out of compliance the first time they bid as a subcontractor.

General liability: not a licensing requirement

The Board sets no general-liability requirement as a condition of licensure. Chapter 624 of the Nevada Revised Statutes and chapter 624 of the Nevada Administrative Code were both checked for it, and neither imposes general-liability cover, nor a minimum amount. What the Board requires is the bond and the proof of industrial insurance, both set out above.

That is a statement about licensure only, and the distinction matters more here than it looks. NRS 624.865(2) and NRS 624.930(2) both defer to bonds and insurance “required” under state and local laws and ordinances, so other law can require cover that the Board does not. Project owners, lenders and general contractors also commonly require general liability as a matter of contract. Being unlicensed-for-lack-of-insurance is not a thing here; being unable to win the work without it is.

A separate bond for residential pools and spas

NRS 624.276(1) requires, before an original license is granted or a license renewed for an applicant who performs or will perform work concerning residential pools or spas, either a bond “solely for the protection of consumers in an amount fixed by the Board” or a cash deposit in lieu of one.

Subsection 2 is the part to read twice. That bond “is in addition to, may not be combined with and does not replace any other bond required pursuant to the provisions of this chapter”, and must be maintained “for 5 years or for such longer period as the Board may require”. So it stacks on the bond above rather than standing in for it. As with that bond, the amount is fixed by the Board and is not in the statute, so no figure is published here, and subsection 3 allows the Board to relieve a pool or spa contractor of it after five consecutive years on evidence, mirroring NRS 624.270(5).

Not yet published here: what NRS 624.270(7) and (8) require of pool, spa and residential photovoltaic contractors. Those subsections have not been read in full for this site, so nothing is stated about what they require — read them directly if either describes the work in question.

Both the bond and the insurance proof have to be current at renewal — see keeping both in force — and they sit alongside the requirements this sits inside. For the overview, see how Nevada contractor licensing works.