Michigan Excavation Permit Bond: A Complete Guide

If you’re a contractor or business planning to perform excavation work in Michigan, understanding the Excavation Permit Bond requirement is crucial. Excavation work, whether for underground utilities, foundation digging, or roadway improvements, can significantly impact public and private property. Because of this, many Michigan municipalities and counties require an Excavation Permit Bond before granting the necessary permits.

At Axcess Surety, we specialize in providing Michigan Excavation Permit Bonds quickly and affordably. This guide covers everything you need to know, including why you need this bond, how much it costs, how to obtain one, and what happens if you don’t comply.

What Is a Michigan Excavation Permit Bond?

A Michigan Excavation Permit Bond is a surety bond required by local government agencies for contractors who perform excavation work. It acts as a financial guarantee that the contractor will comply with local regulations, safety standards, and permit conditions.

This bond protects public property and infrastructure by ensuring that excavation work is completed properly and that any damages caused by the work are repaired. If a contractor fails to follow regulations or causes property damage without proper restoration, the bond provides compensation to the affected parties.

Why Is an Excavation Permit Bond Required in Michigan?

The primary purpose of the Michigan Excavation Permit Bond is to protect public roads, utilities, and infrastructure from negligent or non-compliant excavation work. Since excavation often involves digging near water, gas, sewer, and electrical lines, improper work can lead to:

• Damage to underground utilities – leading to service disruptions and costly repairs

• Soil erosion or instability – impacting roads, sidewalks, or nearby structures

• Safety hazards – such as open trenches or improperly marked work zones

• Environmental harm – including water contamination or drainage issues

By requiring a bond, Michigan municipalities ensure that contractors have a financial incentive to complete projects responsibly and repair any damages. If a contractor fails to meet these obligations, the government or affected parties can file a claim against the bond for reimbursement.

Who Needs a Michigan Excavation Permit Bond?

An Excavation Permit Bond is typically required for any contractor or company performing excavation work on public property or within public rights-of-way. This includes:

✔ General contractors working on infrastructure projects
✔ Excavation and grading companies
✔ Utility contractors installing or repairing water, sewer, gas, or electrical lines
✔ Landscaping companies performing large-scale digging or land alterations
✔ Construction firms working on road expansions, drainage improvements, or underground installations

In some cases, private property excavation does not require a bond, but if the work affects public utilities, sidewalks, or streets, a permit and bond are usually mandatory. Always check with your local municipality or county for specific bonding requirements.

How Much Does a Michigan Excavation Permit Bond Cost?

The cost of an Excavation Permit Bond depends on several factors, including:

1. Required Bond Amount

Michigan municipalities set different bond amounts based on the project scope and risk level. The bond amount can range from $5,000 to $100,000 or more. For most general excavation projects, the requirement is up to $15,000, but larger projects (such as major roadway excavations) may require higher bond amounts.

2. Premium Rate (Bond Cost)

The premium is the percentage of the bond amount that the contractor pays. It typically ranges from 1% to 5% of the bond amount, depending on the applicant’s credit score, financial history, and business experience.

Example Costs:

• $10,000 bond → Premium cost between $100 - $500 per year

• $50,000 bond → Premium cost between $500 - $2,500 per year

• $100,000 bond → Premium cost between $1,000 - $5,000 per year

If you have good credit and a strong financial record, you’ll likely qualify for lower rates. Contractors with poor credit may still obtain a bond, but at a higher cost.

How to Obtain a Michigan Excavation Permit Bond

Getting an Excavation Permit Bond is a straightforward process when you work with an experienced surety provider. Here’s how it works:

Step 1: Check Local Requirements

Each Michigan city, county, or township may have different bonding requirements. Verify the bond amount and any additional conditions set by the local permitting office.

Step 2: Apply for the Bond

Submit a simple bond application with basic business details, including:
📌 Company name and address
📌 Contractor’s license details
📌 Estimated project size and duration

Step 3: Underwriting Process

The surety company evaluates your financial history, credit score, and business experience.

• Good credit (700+) → Low premium rates (1%-3%)

• Fair credit (600-699) → Moderate premium rates (3%-5%)

• Poor credit (<600) → Higher premium rates (5%+), but still obtainable

Step 4: Bond Issuance

Once approved, you’ll receive your bond certificate, which you must submit to the local permit office to obtain the excavation permit.

What Happens If You Don’t Get an Excavation Permit Bond?

Failing to secure the required Excavation Permit Bond can lead to serious consequences:

❌ Permit Denial – You won’t be able to legally start excavation work.
❌ Project Delays – Without a bond, approvals for your project can be delayed indefinitely.
❌ Fines & Penalties – Operating without a permit and bond can result in hefty fines or legal actions.
❌ Financial Liability – If your excavation work causes damage, you could be held personally responsible for costly repairs.

In our experience, many contractors assume bonding is optional, only to face major setbacks when local authorities enforce permit requirements. Getting bonded upfront saves time, prevents legal issues, and ensures project approval.

Common Mistakes to Avoid with Excavation Permit Bonds

🚫 Not verifying bond requirements – Different municipalities have different bond amounts. Always confirm the required bond amount before applying.
🚫 Waiting until the last minute – Some bonds require underwriting, which can take a few days. Apply early to avoid project delays.
🚫 Not renewing the bond – If your project extends beyond the initial permit period, ensure your bond remains active to stay compliant.
🚫 Assuming all bonds are the same – Excavation bonds differ from contractor license bonds and performance bonds. Make sure you get the correct bond for your permit.

Why Choose Axcess Surety for Your Michigan Excavation Permit Bond?

At Axcess Surety, we make the bonding process fast, simple, and affordable. Here’s why contractors trust us:

✔ Quick Approvals – Many bonds issued same-day
✔ No Hidden Fees – Transparent pricing with competitive rates
✔ All Credit Types Accepted – We work with contractors of all financial backgrounds
✔ Expert Support – We help you understand and meet Michigan’s bonding requirements

Get Your Michigan Excavation Permit Bond Today

If you need an Excavation Permit Bond in Michigan, we’re here to help. Our team specializes in fast approvals and competitive rates, ensuring you get bonded without delays or complications.

📞 Call us today or apply online now to get started!