Bonds

Contract bonds provide financial security on specific contracts by assuring the project owner (obligee) that the contractor (principal) will perform the work and pay certain subcontractors, and or material suppliers.

• Bid bonds: Guarantees the bidder will perform the contract at the amount bid. Performance bonds: Guarantees performance of the contract by the principal. 
• Performance and Payment bonds: Guarantees payment by the principal to subcontractors, laborers, and suppliers.

Commercial bonds provide assurance that the principal will perform in the manner agreed upon in the bond.

• License and permit bonds: Required by city, county, or state prior to obtaining certain licenses and permits.
• Public official bonds: Guarantees the honest and faithful performance of a public official’s duties determined by law, regulation, or ordinance.