Contract Bonds

Definition: A bond given to secure the performance of a contract. Often, two bonds are required: one to cover performance specified in the contract and the other to cover payment of certian labor and material bills. These are known as payment and performance bonds. A third type of bond is a bid bond, which is given by a bidder for a supply or construction contract to guarantee that the bidder, if awarded the contract, will enter into the contract and furnish the prescribed performance and/or payment bond.

The bonds require extensive underwriting, review of financial statements and work on-hand and projected. It is a good idea to begin the process early before it is needed. A line of surety credit can be established and used for future contracts. Contact our office for the application packet.