When working in construction, it’s likely that your company will be required to obtain a surety bond. If you are not familiar with these bonds, they are contracts that protect a project owner from unsatisfactory outcomes, such as failure to complete the work on time or at the correct specifications. They are also used to ensure the contractor pays all subcontractors and suppliers. If something goes wrong on a project, the project owner can file a claim against the bond to get financial compensation.
Construction surety bonds are typically purchased by a construction business or contractor as an additional protection in addition to insurance policies. Typically, the contracting business that purchases a bond needs to pass a process called underwriting to qualify for it. The underwriting process includes reviewing a number of factors including the company’s financial standing, their current and past job records, and any previous claims against them.
The main benefit of a surety bond is that it transfers some of the construction risk from the project owner to the bonding company. This can save the project owner a significant amount of money if something goes wrong on a project. It also helps them trust contractors and feel comfortable hiring them for future projects. BigRentz can help you find the right construction surety bond for your business. Just give us a call or fill out our quick and easy online application to get started! We have years of experience ensuring that our clients get the best possible coverage and rates.