Fire Protection Sprinkler System Contractor ($10,000) Bond - Statewide in Tennessee

Brief Summary

If your sprinkler firm does not hold a Tennessee Board for Licensing Contractors license covering fire sprinkler work, this $10,000 bond is what the State Fire Marshal's Office needs before it will issue your certificate of registration. It is a flat amount with no tiers, it is quoted quickly, and you pay an annual premium instead of posting cash with the state.

Tennessee Code 62-32-105 requires every applicant for a fire protection sprinkler system contractor certificate of registration to file a $10,000 surety bond payable to the State of Tennessee, unless the firm is licensed by the Board for Licensing Contractors to do fire protection sprinkler system work. The bond goes to the State Fire Marshal's Office Permits and Licenses Unit with the $100 nonrefundable application fee and the $500 registration fee. Certificates expire June 30 each year.

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How to Apply for a Fire Protection Sprinkler System Contractor ($10,000) Bond:

• Confirm whether the firm holds a Board for Licensing Contractors license covering fire sprinkler work. If it does, submit a copy of that license instead of the bond.
• Have the firm's legal name exactly as it appears on the registration application.
• Owner name, home address and Social Security number for the surety's credit review.
• Complete the bond application and review the quoted premium.
• Receive the executed $10,000 bond payable to the State of Tennessee.
• Submit the bond with the firm application, the $100 nonrefundable application fee and the $500 registration fee to the State Fire Marshal's Office Permits and Licenses Unit.

Detailed Information About the Tennessee Fire Protection Sprinkler System Contractor ($10,000) Bond:

Who has to post this bond

No one may act as a fire protection sprinkler system contractor in Tennessee without a certificate of registration from the Department of Commerce and Insurance, issued through the State Fire Marshal's Office. Tennessee Code 62-32-105 makes a $10,000 surety bond, executed with a surety authorized to do business in Tennessee and payable to the State of Tennessee, part of that application. The amount is flat. It does not change with firm size, revenue or the number of systems installed.

Who is exempt

The same section says the bonding requirement does not apply to anyone licensed to engage in fire protection sprinkler system work by the Board for Licensing Contractors under chapter 6 of Title 62. The State Fire Marshal's firm application puts it plainly: if the firm is licensed by the Board, provide a copy of that license, and if it is not, provide evidence of an executed $10,000 surety bond. Firms that hold a Board license should check that the license actually covers sprinkler work before skipping the bond.

What the bond guarantees

The bond is for the use and benefit of any person injured or aggrieved by a wrongful act or omission of an employee, servant, officer or agent in the conduct of the sprinkler contractor's business. A person harmed by the firm's work can make a claim against it up to the $10,000 penalty, and the firm must repay the surety for any claim paid.

The RME requirement does not replace the bond

Under Tennessee Code 62-32-104, every registered sprinkler contractor must employ a responsible managing employee who holds a valid license from the Department of Commerce and Insurance. The RME is licensed separately and the firm still posts the bond unless it falls within the Board license exemption.

Fees and term

The state lists a $100 nonrefundable application fee, a $500 issuance fee, a $200 renewal fee and a $100 late renewal fee. All certificates expire on June 30 of each year, so keep the bond in force through each renewal.

How premium is set

The surety sets the annual premium as a percentage of the $10,000 penalty after reviewing the owner's personal credit. Stronger credit earns a lower rate.

Eligibility and Requirements for a Tennessee Fire Protection Sprinkler System Contractor ($10,000) Bond:

• Surety company authorized to do business in Tennessee.
• Bond amount of $10,000, payable to the State of Tennessee.
• At least one licensed responsible managing employee employed by the firm.
• Applicant at least 18 years old.
• Annual renewal before the June 30 expiration, with the $200 renewal fee.

Tennessee Fire Protection Sprinkler System Contractor ($10,000) Bond FAQs:

Official and Additional Resources for the Tennessee Fire Protection Sprinkler System Contractor ($10,000) Bond: