Irrevocable Letter Of Credit Template (Page 2 of 3) in pdf

RULES

TENNESSEE BOARD FOR LICENSING CONTRACTORS

GENERAL REGULATIONS FOR HOME IMPROVEMENT CONTRACTORS

FINANCIAL RESPONSIBILITY

068007.13 BONDS.

(1) Bonds shall be written on a form approved by the Insurance Commissioner, available

through the Board, which shows the name of the principal as it appears on the license

application.

(2) Description of Bonds.

(a) Cash Bonds.

Cash bonds may not include personal checks.

Cash bonds may include:

1. Currency, which shall be deposited with the State Treasurer, subject to

the order of the Board, and which may not earn interest;

2. Cashier’s check, certificate of deposit for a term of at least two (2) years

or certified check:

(i) Issued by a financial institution;

(ii) Showing the name of the purchaser; and

(iii) Assigned and payable to the Board;

3. Savings and loan association certificates, passbook or share accounts,

credit union or share accounts, passbook savings or other similar

accounts assigned and payable to the Board, which shall be issued for

periods of not less than one (1) year and accompanied by delivery of the

certificate passbook, share account, certificate, passbook or other similar

account to the Board.

(b) Property Bond

1. A property bond shall be the assignment to the Board by an owner

applicant of an interest of ten thousand dollars ($10,000.00) in real

property located in Tennessee; and submission of a title search showing

any encumbrances on the property.

2. The Board may require the applicant to submit an appraisal of the

property to ascertain that the unencumbered value of the property is at

least ten thousand dollars ($10,000.00).

1. A surety bond shall be in the amount of ten thousand dollars

($10,000.00), issued to a home improvement contractor by an approved

insurance company authorized to do business in Tennessee, for the

benefit of a claimant, who has been damaged by the contractor’s breach

of a home improvement contract. If the bond ceases to be in effect, the

home improvement contractor’s license shall become invalid.

2. The Board may refuse to accept a bond written for a home improvement

contractor by a surety which has failed to meet its obligations under this

subtitle.

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