Contract & Construction Bonds
Contract surety bond — what it is, what it costs, and how to get one.
Get notified when we openWhat is a contract surety bond?
A contract surety bond guarantees that a contractor will fulfill the terms of a construction contract. Required on most public works and government projects, these bonds protect the project owner if a contractor fails to honor a bid, complete the work, or pay their subcontractors and suppliers.
Who needs a contract surety bond?
Contractors bidding on public construction and government-funded projects almost always need contract bonds, and private owners may require them too. The set usually includes bid, performance, and payment bonds, sometimes followed by a maintenance bond once the work is done.
How much does a contract surety bond cost?
Contract bonds are underwritten, so the surety reviews your business financials, credit, and experience. Premiums are typically a single-digit percentage of the contract or bond amount, with stronger financials earning lower rates. Bid bonds are often issued at little or no cost as part of the bidding process.
How to get a contract surety bond
Establish a bonding relationship by sharing your financials and project history.
Request the specific bond your project requires.
Complete underwriting review and accept your quote.
Receive your issued bond and submit it with your bid or contract.
Frequently asked questions
A performance bond guarantees the work gets finished; a payment bond guarantees subs and suppliers get paid.
Federal and most state laws require them to protect taxpayer-funded projects from contractor default.
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