Bill Text: NJ A5652 | 2020-2021 | Regular Session | Introduced
Bill Title: Requires home improvement and home elevation contractors to post bonds before providing services in New Jersey.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2021-05-12 - Introduced, Referred to Assembly Regulated Professions Committee [A5652 Detail]
Download: New_Jersey-2020-A5652-Introduced.html
Sponsored by:
Assemblywoman ANGELICA M. JIMENEZ
District 32 (Bergen and Hudson)
SYNOPSIS
Requires home improvement and home elevation contractors to post bonds before providing services in New Jersey.
CURRENT VERSION OF TEXT
As introduced.
An Act concerning bonds for contractors and amending P.L.2004, c.16.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. Section 7 of P.L.2004, c.16 (C.56:8-142) is amended to read as follows:
7. a. On or after December 31, 2005, every registered contractor who is engaged in home improvements shall secure, maintain and file with the director proof of a certificate of commercial general liability insurance in a minimum amount of $500,000 per occurrence. In addition to the insurance policy, the director shall require posting of a surety bond in the amount of $12,000 and in favor of the owner, lessee, tenant or other party to the home improvement contract. Every bond and insurance policy required to be maintained pursuant to this subsection shall provide that the issuer of that bond or policy shall give the director written notice of cancellation or termination of the bond or cancellation or non-renewal of the policy within 10 days of the cancellation or non-renewal.
b. Every registered contractor engaged in home improvements and home elevation whose surety bond is cancelled or terminated or whose commercial general liability insurance policy is cancelled or nonrenewed shall submit to the director a copy of the bond or the certificate of commercial general liability insurance for a new or replacement bond or policy which meets the requirements of subsection a. of this section before the former bond or policy is no longer effective.
c. Every home elevation contractor engaged in performing home elevations, in addition to the insurance required pursuant to subsection a. of this section, shall secure and maintain cargo or other insurance that specifically covers home elevation activities, in a minimum amount of $1,000,000 per occurrence to cover damages or other losses to the homeowner, lessee, tenant or other party resulting from a home elevation, except as otherwise provided in this subsection. The [Director of the Division of Consumer Affairs] director in consultation with the Department of Banking and Insurance may promulgate rules and regulations to implement this subsection, which rules and regulations also may require that home elevation contractors secure and maintain additional insurance of such kind and in such amounts as the director may determine in consultation with the Department of Banking and Insurance. In addition to [or as an alternative to] the insurance required by this subsection, the director [may] shall also require the posting of a surety bond in the amount of $12,000 and in favor of the owner, lessee, tenant or other party to the home improvement contract for home elevation. Every bond and insurance policy required to be maintained under this subsection shall provide that the issuer of that bond or policy shall give the director written notice of cancellation or non-renewal of the bond or policy within 10 days of the cancellation or non-renewal.
d. A home elevation contractor, prior to entering into an agreement to perform a home elevation, shall provide proof of insurance to the homeowner including the issuing insurer, policy number, type, and amount of insurance coverage maintained by the contractor in accordance with this section.
(cf: P.L.2014, c.34, s.4)
2. This act shall take effect on the first day of the seventh month next following enactment and shall be applicable to home improvement or home elevation contracts agreed to after that date.
STATEMENT
This bill requires home improvement contractors and home elevation contractors to post surety bonds in order to provide contracting services in New Jersey. The bonds are to be in the amount of $12,000 and in favor of the owner, lessee, tenant or other party to the home improvement or home elevation contract. Every bond is to provide that the issuer of that bond is to give the director of the Division of Consumer Affairs written notice of cancellation or termination of the bond within 10 days of the cancellation or termination. If a bond has been cancelled or terminated, the home improvement or home elevation contractor is to submit to the director a copy of the bond that is to replace the old bond prior to the date when the old bond is no longer effective.
