Performance Bonds
Performance & Payment Bonds
What Is A Performance Bond?
Performance bonds are provided to protect the owner. They ensure a contractor will perform work required in connection with a contract award or winning bid. If a contractor defaults or becomes insolvent before finishing the project, the bond could be used to retain another contractor to perform the work and/or compensate the owner for any losses.
How Do Performance & Payment Bonds Work Together?
A payment bond and a performance bond work hand in hand. A payment bond guarantees that the contractor will pay all entities, such as subcontractors, suppliers, and laborers, for that particular contract.