An insurance bond ensures contract completion in the event of contractor default and are typically required by project owners when seeking a contractor to fulfill a contract.

The contractor obtains a bond so the insurance company is obligated to compensate the project owner for the financial loss incurred if the work is not completed. ​

Although there are many types of insurance bonds, the four most common types needed by business owners are:

  • Bid Bond – Ensures the bidder on a contract will enter into the contract and furnish the required payment and performance bonds if awarded the contract.
  • Payment Bond – Ensures suppliers and subcontractors are paid for work performed under the contract.
  • Performance Bond – Ensures the contract will be completed in accordance with the terms and conditions of the contract.
  • Ancillary Bond – Ensures requirements integral to the contract, but not directly performance related, are performed.

Contact us to learn more about the right insurance bond for you.

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